New Zealand Dollar Forecasts: NZD Exchange Rate Vs Pound, Aussie Dollar And Euro Softer On Low Card Spending

Published: 20 Oct 2017 21:23 Forex

new zealand dollar exchange rate

Today's New Zealand Dollar Exchange Rate Report and Forecasts vs the Pound Sterling, the Euro and the Australian Dollar FX Rates

Wednesday: The New Zealand Dollar recorded losses against the Pound and Euro while advancing against the Australian Dollar after card spending figures printed unfavourably.

Retail spending on cards decreased for the second consecutive month after the price of petrol and diesel dipped, causing less spend on refuelling.

Total fuel expenditure dropped by 3.2% in December, totalling losses of $23 million.

NZD Trended Lower vs The Majors

The New Zealand Dollar has been trending lower against the Pound, Euro and Australian Dollar despite New Zealand’s Weekly Consumer Confidence rising to 112.0 from 111.7 in the week through January 11th.

The NZ Dollar exchange rate had been steady against other currency majors in the Oceanic session when Chinese trade data printed favourably.

China’s trade surplus remained buoyant at $49.6 billion in December with a rebound in exports. China’s trade balance crept up by almost 50% in 2014, achieving$382.46 billion.

Economist Julian Evans-Pritchard commented: ‘Looking ahead, although the global economy remains fragile we nonetheless expect growth in many of China’s key export markets, such as the US, to stage a slight recovery this year, which should provide support to Chinese exports. Meanwhile, we think domestic demand, particularly for commodities, is likely to remain subdued and that those anticipating a stimulus-driven pick-up of investment of a marked turnaround in the property sector will be disappointed.’

The Australian Dollar also gained due to an increase in the value of iron ore. After China decided to fast track 300 building projects last week, the commodity’s value has increased and there are forecasts for more gains ahead.

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Australian Employment Change and Unemployment Rate figures are out on Thursday and could further impact the Australian Dollar.

Pound to New Zealand Dollar Forecast

Meanwhile, the Pound suffered losses against other currency majors such as the US Dollar when the UK’s Consumer Price Index dropped from 1.0% to 0.5%. Forecasts had suggested a smaller decline to 0.7%.

Furthermore, many traders took the inflation slump as a sign that the Bank of England would refrain from hiking interest rates until 2016.

Industry expert John Wraith stated: ‘Inflation is slowing very sharply and the market is rightly anticipating, largely as a result of that, that the prospect of monetary tightening has disappeared over the horizon now. We’re not even 10 basis points above the all-time low in 10-year gilt yields and well below it in 30-year yields so it’s a pretty dramatic repricing.’

New Zealand Dollar to Euro Exchange Rate Forecast

The Euro also suffered losses due to consumer prices last week as the 19-nation Euro area entered deflation.

European Central Bank member Ewald Nowotny has suggested that the ECB needs to take action sooner rather than later to revive the Eurozone economic recovery.

Nowotny stated: ‘It is important that one takes deflation risks seriously and addresses them. We shouldn’t wait too long with a reaction.’

This month will see the ECB decide on stimulus measures for the Eurozone - a development that’s likely to see the Euro fluctuate.

Update 15/01/2015:

German GDP figures detailing growth in 2014 will be available on Thursday and could impact the Euro.

Final Eurozone Consumer Price Index stats will emerge on Friday and other ECB officials will be speaking about Eurozone economics.

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