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Pound New Zealand Dollar (GBP/NZD) Exchange Rate Jumps as Coronavirus Cases Slow

April 14, 2020 - Written by John Cameron

Pound Sterling New Zealand Dollar (GBP/NZD) Exchange Rate Rallies on Risk Appetite Rebound



The Pound Sterling New Zealand Dollar (GBP/NZD) exchange rate jumped by around 0.4% on Tuesday, leaving the pairing trading at around NZ$2.0605.

Today saw the Pound jump, rebounding against both of its main rivals, the US Dollar (USD) and Euro (EUR) as well as the New Zealand Dollar.

GBP benefitted from the improved risk appetite seen this month as coronavirus cases slow and some countries consider reopening.

This comes despite the warnings from experts that coronavirus is likely to see the UK be the worst hit country in Europe.

According to MUFG’s currency analyst, Lee Hardman:

‘We’re still in this reversal mode where currencies hit hard last month are rebounding. The Pound was one of the worst performing currencies last month. Britain has a large current account deficit and is seen as vulnerable in crisis conditions - it also performed badly in the financial crisis. But we are now moving away from a period of tension and stress in markets, allowing currencies like the Pound to gradually recover.’


New Zealand Dollar (NZD) Falls despite Rebound in Risk Appetite



The New Zealand Dollar struggled to make gains against the Pound despite the upswing in risk appetite today.

Better-than-expected Chinese data revealed a much less gloomy picture of the economic fallout caused by the coronavirus pandemic.

China’s exports slumped by -6.6% despite earlier forecasts of a -14% fall, while imports slipped -0.9% compared to an expected -9.5%, which boosted risk appetite.

Meanwhile, the ‘Kiwi’ was offered further support after comments from Finance Minister Grant Robertson.

The country’s Finance Minister said that bank lending should be viewed as part of their ‘social licence’ to operate, and government spending should be used to support individuals, firms and encourage job-rich industries.

According to Kiwibank dealer, Mike Shirley this all fuelled an increase in demand for the risk-sensitive ‘Kiwi’. Shirley noted:

‘It’s all underpinned by general weakness in the US Dollar.’


Added to this, the country’s latest coronavirus numbers offered NZD further support. Tuesday’s numbers showed new infections rose by just 17 while the country’s death toll increased by four, bringing the total to nine.

However, this did not provide the ‘Kiwi’ with enough support to rise against the Pound on Tuesday, although it likely limited Sterling's gains.

Pound New Zealand Dollar Outlook: Will Risk Appetite Continue to Boost GBP?



Looking ahead, the coronavirus pandemic is likely to remain the main catalyst for movement of both the Pound (GBP) and New Zealand Dollar (NZD) due to a lack of economic data releases.

Risk appetite will rise if the number of cases worldwide continue to slow, showing the lock downs are working.

Meanwhile, traders will be looking to the end of the week as China is scheduled to release a slew of economic data.

If China’s retails sales, GDP and industrial production mirrors today’s data, showing the economic fallout from the virus is not as bad as expected, risk appetite could send the Pound New Zealand Dollar (GBP/NZD) exchange rate higher.




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