Pound Sterling Exchange Rate Update: Instability for GBP after Week of ‘Brexit’ Concerns
At the time of writing, the pound to New Zealand dollar exchange rate trades nearly 0.5% lower at 1.75546, having plunged sharply down on yesterday's Brexit / Article 50 news.
The GBP to NZD exchange rate plunged just like Sterling’s other major currency pairs, despite the ‘Kiwi’ performing poorly against other majors itself.
While the ‘Kiwi’ lacked in appeal compared to other risk-correlated peers, Sterling’s market-wise selloffs led to it losing value against even the weak New Zealand Dollar. New Zealand investors will hope for strong performance in Tuesday’s global dairy trade auction before they buy up the ‘Kiwi’.
The Pound has failed to make much in the way of gains today, in spite of surprisingly positive result for the latest UK PMI.
The good news has come from the manufacturing PMI for September climbing from 53.3 to 55.4, against expectations of a dip to 52.8. Less positive, however, has been the confirmation from the Prime Minister that the latest for Article 50 to be triggered will be late March, 2017.
The Pound managed to close off trading last week in a relatively positive state against its regular peers, although the week’s overall movement was limited by widespread ‘Brexit’ concerns.
On the positive side of the situation was Trade Secretary Liam Fox, who called the situation a ‘golden opportunity’ for the UK when it came to future trade deals.
Less supportively, however, were the estimates that ‘Brexit’ negotiations would cost taxpayers millions, while Italian Prime Minister Matteo Renzi said it would be impossible for UK citizens to have more rights outside of the EU compared to within it.
Latest Pound/New Zealand Dollar Exchange Rates
On Thursday the Pound to British Pound exchange rate (GBP/GBP) converts at 1
Today finds the pound to pound spot exchange rate priced at 1.
The live inter-bank GBP-EUR spot rate is quoted as 1.167 today.
The live inter-bank GBP-USD spot rate is quoted as 1.252 today.
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.
Pound Sterling Predictions: ‘Brexit’ Links to be Made on Incoming PMI Stats
The aftermath of the EU Referendum is set to continue being an issue next week, with three notable measures of the UK’s economic performance coming from Monday to Wednesday.
These will consist of the manufacturing, construction and services PMIs for September, which are respectively forecast to fall, rise and fall.
The construction result has a return to growth on the cards, though this could be offset if the manufacturing and services sectors get close to or even falling into the contraction range.
New Zealand Dollar News: Positive Overall Week for ‘Kiwi’ on Permits and Confidence Data
While last week was fairly limited when it came to direct data, the New Zealand Dollar was nonetheless able to climb against the competition due to bursts of optimism among NZD investors.
On the global scale, New Zealand was pushed from 16th to 13th on the Global Competitiveness Index, an improvement of 10 places since 2012.
On the homefront, August’s building permits shifted from -8.1% to -1%, while the ANZ business confidence figure for September jumped from 15.5 to 27.9.
NZD Outlook: Dairy Prices and Confidence Stats Incoming Next Week
The coming week is set to have an extremely sparse scattering of New Zealand data, with Monday bringing the only real announcements for the antipodean nation.
The Global Dairy Trade auction is due late on Monday and on into Tuesday; this previously saw costs rise by 1.7%.
Also out during Monday night will be the NZIER business confidence and capacity utilisation figures for Q3. In both cases, rises are expected.
Tuesday sees the Gov Wheeler speaking at the Northland Chamber of Commerce, in Whangarei.
New Zealand Focus: Optimism from NZ Economic Development Minister
Giving remarks on last week’s positive competitiveness news for New Zealand was Minister for Economic Development Steven Joyce, who said that;
‘The report highlights the good work this Government is doing to reduce the cost of doing business and create a competitive and productive economy. Through our comprehensive Business Growth Agenda and Better Public Services programme we are working to support an environment where businesses have the confidence to invest, grow and create more and better paying jobs for Kiwis and their families’.
The New Zealand dollar, however, isn't forecast to perform well according to the latest Saxobank studies:
"This is one of our least favored currencies if rates continue higher as this would challenge the reach-for-yield theme and we have seen signs of NZD broadly turning weaker."
"Still it wouldn’t hurt to see NZDUSD breaking down through 0.7200/25 after an absurdly long bout of indecision."