April 18, 2019 - Written by John Cameron
STORY LINK Pound to New Zealand Dollar Exchange Rate Today: GBP/NZD Rises on Fears of RBNZ Interest Rate Cut
The Pound New Zealand exchange rate edged higher to above 0.3% today and is currently trading around NZ$1.9462 on the inter-bank market.
The New Zealand Dollar (NZD) has weakened against the Pound (GBP) as its status has become increasingly unappealing following this week’s disappointing economic data – NZ CPI figures fell below expectation on Tuesday.
This has weighed on market confidence, with fears rising that the Reserve Bank of New Zealand will slash its interest rates.
Gareth Kiernan, a Chief Forecaster at Infometrics, also sounded gloomy about the New Zealand economy, saying:
‘The New Zealand economy is lacking the investment needed to drive innovation and continued strong growth. We predict that GDP growth will average just 1.5 percent over the three years to March 2024, less than half the average rate maintained throughout the last six years.’
GBP/NZD Exchange Rate Rises as UK Retail Sales Soar
The Pound, meanwhile, has gained on weakened ‘Kiwi’ following impressive UK retail sales figures for March, which rose above forecast to 1.1%.
These were followed by the year-on-year retail figures, which shot up above expectation to 6.7%, restoring confidence in the UK’s economy despite Brexit uncertainty.
Ed Monk, an Associate Director at the personal investing company, Fidelity Information, said:
‘Even accounting for the Beast from the East, which kept shoppers at home a year ago, today's retail sales data show households willing to spend more. That reflects a slow recovery from a decade-long wage squeeze and, perhaps, a willingness to look through the apparently never-ending uncertainty that is Brexit.’
There has been a general lack of Brexit news today, with many MPs away on their parliamentary Easter recess.
Cross-party talks between the Labour party and the Conservatives have, however, been continuing.
However, Labour leader Jeremy Corbyn’s remarks that Tory MPs are only really interesting in securing a trade deal with Trump has dampened confidence in these talks being constructive.
GBP/NZD Forecast: Sterling Could Rise on Signs of a Cross-Party Agreement
There are no New Zealand or UK economic data releases due out tomorrow because of Good Friday.
Pound investors will be looking ahead to Wednesday’s release of the UK public sector net borrowing figures for March, and with any signs of improvement this could buoy Sterling.
Brexit news will, once again, occupy the attention many Pound traders into next week, with MPs set to return to debate the next steps in the withdrawal process.
The GBP/NZD exchange rate could improve if there are any signs of a consensus emerging from cross-party talks.
Any indications that the UK could secure a possible deal ahead of the European elections – which is still a possibility – could see the Pound rise.
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