July 29, 2021 - Written by John Cameron
STORY LINK GBP/NZD Forecast: Pound New Zealand Dollar Exchange Rate Dips Despite Disappointing New Zealand Business Confidence
The Pound to New Zealand Dollar (GBP/NZD) exchange rate has dipped this morning as NZD finds support in the latest dovish Federal Reserve interest rate decision from the US.
At the time of writing the GBP/NZD pairing are trading around the NZ$1.9952 level as Sterling relies on coronavirus developments to drive movement in the currency.
Pound (GBP) Weakens on Lack of Economic Data
The Pound has weakened against the New Zealand Dollar this morning as a lack of economic data from the UK.
Whilst the announcement from the UK government that fully-vaccinated citizens from the EU and US would be able to travel to the UK without quarantining was met positively, it was not enough to bolster Sterling further.
Though a Labour MP was less than optimistic surrounding the proposed plan, saying:
‘The Government’s track record on our borders has been one of recklessness and confusion. They are in danger of continuing this by setting out changes in policy, applying to England only, without the scientific data and criteria we need to make sure we don’t see another Johnson variant run rampant through the country and damage the effort of the British public.’
‘We want to see international travel opened up safely. Ministers need to be clear on what progress has been made on reaching reciprocal agreements for Brits travelling abroad – particularly regarding the NHS app being accepted as proof of Covid status.’
The Pound could be open to further losses throughout the day if any further domestic coronavirus developments fail to impress investors.
New Zealand Dollar (NZD) Supported by Dovish Federal Reserve
The New Zealand Dollar is being supported against many of its major rivals this morning following the latest interest rate decision from the Federal Reserve yesterday evening.
The bank chose to take a more dovish stance which caused a broad weakness in the US Dollar and allowed the ‘Kiwi’ to push higher.
However any major gains for the New Zealand Dollar were limited on the back of a precarious coronavirus situation in New Zealand’s nearest neighbour, Australia.
The latest ANZ business confidence figures fell more than expected as investors worry the effects of the pandemic are far from over.
GBP/NZD Exchange Rate Outlook: UK Coronavirus Developments in Focus
A quieter economic calendar for the end of the week from both the UK and New Zealand will instead see investors focusing on any further coronavirus developments heading into the weekend.
Pound investors will look towards any news regarding daily cases of the virus and how it may change the UK’s economic recovery.
New Zealand Dollar traders will be focusing on the global market mood in the coming days, a resurgence in the US Dollar could see NZD weaken.
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TAGS: Pound New Zealand Dollar Forecasts