The Pound has remained down against most of its regular peers today, though a sizable gain has nonetheless been recorded against the flagging New Zealand Dollar.
On the part of the ‘Kiwi’, the latest losses have been triggered by signs that another national interest rate cut is on the horizon.
Pound Pummelled by ‘Flash Crash’, New Zealand Dollar Drops on RBNZ Hints
The Pound has been in low demand during trading today, although against the weaker New Zealand Dollar, a rise of 0.4% has been recorded to a rate of around 1.73.
The morning’s minor UK news has consisted of BRC like-for-like sales on the year in September rising from -0.9% to 0.4%, although elsewhere, UK domestic data has been extremely limited.
For New Zealand, the latest cause for concern among New Zealand Dollar investors has come from the Reserve Bank of New Zealand (RBNZ), where Assistant Governor John McDermott has said;
‘Interest rates are at multi-decade lows, and our current projections and assumptions indicate that further policy easing will be required to ensure that future inflation settles near the middle of the target range’.
This raises the prospect of a near-term interest rate cut taking place, something considered essential to some at a time when the ‘Kiwi’ is too strong against its peers.
Pound Sterling Future Forecast: Unsettled Week Ahead for Pound due to Data Shortage
With Friday holding the most notable UK data releases this week, trading up to that point is not predicted to be favourable for the Pound.
This is primarily due to the UK’s economic future being made even more uncertain by last week’s ‘flash crash’, which has seen the Pound drop to a position where recovery will be a long, difficult process.
Friday’s main UK data will be the annual August construction output figure, which has a shift from -1.5% to -1.1% on the cards.
New Zealand Dollar Forecast to Rise Tomorrow on PMI Prediction
The first major New Zealand data of the week will arrive on Wednesday night, when the Business NZ PMI for September comes in. As it stands, a small but solid rise from 55.1 points to 55.6 is forecast.
This week is also a quiet one for New Zealand, given that the next data release won’t be until the coming Monday, when decline-forecast Q3 inflation rate results will be announced.
Recent Interbank Exchange Rates
At the time of writing, the Pound New Zealand Dollar (GBP NZD) exchange rate was trending in the region of 1.74 and the New Zealand Dollar Pound (NZD GBP) exchange rate was trending in the region of 0.57.
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