After global dairy prices declined the New Zealand Dollar (NZD) exchange rate complex softened versus most of its major peers.
The New Zealand Dollar exchange rates has made marginal gains against the British pound, euro, Aussie dollar and other peers recently, potentially on dairy prices.
With no direct domestic data to refer to, it is possible that investors in the ‘Kiwi’ have taken heart from the latest dairy price results.
Although a rise in the price of the most limited sense, the cost of class 3 milk per hundredweight going up may have still provided support to the antipodean currency.
The latest PMIs from China have revealed a slowdown in the services sector and the economy as a whole, weakening the New Zealand dollar exchange rates today.
The Caixin services PMI for April dipped from 52.2 to 51.8, while the composite index slipped from 51.3 to 50.8, edging dangerously close to contraction territory.
A lack of NZ data in the near-future may not prevent the British pound from losing out against the New Zealand dollar.
This is on account of the next UK data being out tomorrow morning and negatively predicted.
The data in question will be more PMIs; if a third successive decline occurs, a Bank of England (BoE) Interest Rate hike seems highly unlikely this year.
Today’s Chinese Yuan to US Dollar rate fix is -0.6% lower than yesterday’s - representing the biggest daily drop in eight months and weakening the New Zealand Dollar.
NZD has fallen because the move by the People’s Bank of China (PBoC) has significantly dampened risk-appetite; the last time such a weakening occurred, the markets reacted tumultuously.
Tuesday’s Global Dairy Auction saw prices dip by 1.4% which weighed heavily on demand for the New Zealand Dollar.
However, improved risk-appetite has limited ‘Kiwi’ (NZD) exchange rate depreciation.
Analysts at Citibank predict that the Reserve Bank of New Zealand (RBNZ) will cut the overnight cash rate in June after holding rates in the most recent policy meeting.
Latest New Zealand/Australian Dollar Exchange Rates
On Thursday the Pound to British Pound exchange rate (GBP/GBP) converts at 1
The live inter-bank GBP-GBP spot rate is quoted as 1 today.
Today finds the pound to us dollar spot exchange rate priced at 1.251.
Today finds the pound to australian dollar spot exchange rate priced at 1.919.
NB: the forex rates mentioned above, revised as of 25th Apr 2024, are inter-bank prices that will require a margin from your bank. Foreign exchange brokers can save up to 5% on international payments in comparison to the banks.
Other Currency Exchange News
Pound to New Zealand Dollar Exchange rate Could Rise June 2016?
After yesterday’s GlobalDairyAuction saw prices slump the New Zealand Dollar declined versus most of its major peers.
Mixed domestic data results overnight saw the NZD climb fractionally but failed to provoke sustained appreciation.
Whilst first-quarter Employment Change bettered expectations of 1.3% growth, with the annual result actually reaching 2.0%, first-quarter Unemployment Rate climbed beyond expectations to 5.7%.
New Zealand Dollar exchange rates are still holding a comparatively strong position after the RBNZ avoided cutting the overnight cash rate.
However, analysts at Citibank predict that policymakers will opt to cut rates in June.
‘The RBNZ removed its comments on global economic downside risk in the policy statement, reflecting the central bank is more neutral towards global economic outlook. Since the RBNZ said to further ease policy, we still expect the central to cut the interest rate by 25bps in June 2016. However, in our view, since markets may have priced in the expectation of rate cuts by the RBNZ, a rate cut may have limited impact on NZD. NZD may find support amid USD downside pressure on US economic slowdown.’
Pound Sterling (GBP) Exchange Rates Struggle after Weak Construction Data
The British Pound began the week in a position of strength having erased all of its 2016 losses versus the US Dollar.
However, weak manufacturing data dampened demand for the UK unit amid concerns that British sectoral growth is completely reliant on services output to stoke economic growth.
On Wednesday the Pound slipped further after construction data also failed to impress; adding further pressure on the services sector to outperform current expectations.
Australian Dollar (AUD) Exchange Rates Weakens after RBA Cut Rates
In what was a somewhat surprising move to most traders, the Reserve Bank of Australia (RBA) cut the overnight cash rate by 25 basis points to the historical low of 1.75%.
This caused the Australian Dollar to dive versus its major peers, with US Dollar gains predicted to cause further ‘Aussie’ (AUD) losses.
Australian Dollar depreciation will be welcomed by RBA policymakers, however, given long-term concerns regarding ‘Aussie’ overvaluation.