Latest Pound Sterling to New Zealand Dollar Exchange Rate Forecast to Stand within a Tight Range after UK Inflation Drops to Zero
The New Zealand Dollar exchange rate advanced on the Pound, US Dollar and Australian Dollar after the latest dairy price auction showed a strong increase in the price of New Zealand's key commodity. New Zealand's current account data also showed improvement.
A quick NZ Dollar foreign exchange market summary before we bring you the rest of the report:
On Friday the Pound to British Pound exchange rate (GBP/GBP) converts at 1
The GBP to GBP exchange rate converts at 1 today.
The GBP to AUD exchange rate converts at 1.93 today.
The live inter-bank GBP-USD spot rate is quoted as 1.239 today.
NB: the forex rates mentioned above, revised as of 19th 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 to New Zealand Dollar Exchange Rate Forecast
The Pound Sterling to New Zealand Dollar exchange rate was trending within a limited range on Tuesday afternoon.
Despite the fact that UK inflation data equalled median market forecasts, the Pound edged lower versus many of its currency rivals. This is due to fears that the lack of inflationary pressure will allow Bank of England (BoE) policy makers to delay a benchmark interest rate hike. August’s Consumer Price Index flat lined on the year in line with expectations. BoE officials have already warned that inflation is likely to remain low until the turn of the year amid falling oil prices.
The Pound Sterling to New Zealand Dollar exchange rate is currently trending in the region of 2.4323.
After China’s equity market registered a second-consecutive day of declination, the risk-correlated New Zealand Dollar softened versus many of its peers. The Shanghai Composite Index ended the session 3.5% down. Also weighing on demand for the ‘Kiwi’ (NZD) is mounting hopes that the Federal Reserve will hike the cash rate on Thursday, although today’s weak US economic data has reduced those hopes somewhat. The Pound Sterling to New Zealand Dollar exchange rate was trending within the range of 2.4294 to 2.4486 during Tuesday’s European session.
Australian Dollar to New Zealand Dollar Conversion Rate Declines Today on Dovish RBA Minutes
The Australian Dollar to New Zealand Dollar exchange rate softened by around -0.4% on Tuesday afternoonThe Australian Dollar to New Zealand Dollar exchange rate is currently trending in the region of 1.1256.
UBS analysts predict that the Reserve Bank of New Zealand (RBNZ) will cut the cash rate further despite the recent 25 basis point cut to 2.75%. This is mainly the result of China’s economic slowdown weighing on New Zealand’s growth prospects. Low commodity prices, with particular reference to dairy, is having a significantly detrimental impact on New Zealand’s exports. UBS stated that the deterioration in New Zealand’s Gross Domestic Product could see the RBNZ cut the cash rate by another 25 basis points as soon as October. The Australian Dollar to New Zealand Dollar exchange rate was trending within the range of 1.1231 to 1.1307 during Tuesday’s European session.
US Dollar to New Zealand Dollar Exchange Rate Predicted to Edge Higher despite Weak US Data
The US Dollar to New Zealand Dollar exchange rate advanced by around 0.4% on Tuesday afternoon. With trader focus dominated by Thursday’s Federal Reserve interest rate decision, today’s weak US data had minimal impact on US Dollar movement. Advance Retail Sales, Manufacturing Production and Industrial Production all failed to meet with the respective median market projections. The ‘Greenback’ (USD) gains can be linked to speculation that the Federal Reserve will look to hike the cash rate on Thursday so as not to become prisoner to changing market conditions.
The US Dollar to New Zealand Dollar exchange rate is currently trending in the region of 1.5834.
Looking ahead, New Zealand’s economic docket is comparatively sparse of influential domestic data over the remainder of the week. However, Wednesday’s Gross Domestic Product for the second-quarter is likely to cause significant ‘Kiwi’ volatility. With that being said, a positive result may not have a huge impact on New Zealand Dollar movement given that the data precedes China’s economic downturn. The US Dollar to New Zealand Dollar exchange rate was trending within the range of 1.5764 to 1.5865 during Tuesday’s European session.
Forex Newsflash: UBS Predicts More RBNZ Policy Easing as China Weighs
UBS analysts stated; ‘The slowdown in China and weak commodity prices continue to weigh on growth expectations for both Australia and New Zealand. The Reserve Bank of New Zealand (RBNZ), as widely anticipated, recently cut the cash rate again by 25 bps to 2.75% (totalling 75 bps so far). Its statement made crystal clear that more easing is likely. Despite a material decline already, the RBNZ still maintains that ‘further depreciation is appropriate’ for the NZD, although no longer ‘necessary.’ This is a clear toning down of its rhetoric on the easing bias and NZD, counterbalanced by a deterioration in the GDP outlook since the June Monetary Policy Statement. While the cash rate is now at our cycle low point of 2.75%, we see greater risks of a further 25 bp cut, potentially as early as October.’