The Pound Sterling (GBP) has made losses of -1.2% against the Australian Dollar (GBP/AUD) and the New Zealand Dollar (GBP/NZD) today, with the likely cause being a disappointing development from Brussels.
‘Long Way to Go’ Says Cameron after Brussels Meeting Bears No Fruit
The most recent news for the UK has come via Brussels, where after a day of talks with EU leaders, PM David Cameron has firmly rejected the proposed ‘Emergency Brake’ solution offered.
While some may consider this to show the PM taking a firm stance against an unsatisfactory deal, others are likely to remain more focused on the fact that a February finalisation of the referendum terms is now even further out of reach.
The Pound Sterling (GBP) has fallen by -0.8% against the Australian Dollar (GBP/AUD) and by -0.9% against the New Zealand Dollar (GBP/NZD) today; this movement has potentially been caused by a slew of forecasts given by UK business owners over the outcome of a ‘Brexit’ scenario.
Spread of Predictions on Display Today ahead of Brussels News
A report can be expected from Brussels at some point in the near future, but ahead of that, business owners and companies likely to affected by a UK/EU separation have had their say on what may come of such an outcome.
Unilever’s Paul Polman has given a neutral statement, pointing out that uncertainty in general is bad for the UK economy, while Standard Life Investments’ Anthony Browne has estimated that a UK exit would be ‘a shock that would register about 15 on the Richter scale’.
The Pound Sterling (GBP) has made respective losses of -0.3% against the Australian Dollar (GBP/AUD) and -0.4% against the New Zealand Dollar (GBP/NZD) today, movement that comes in contrast with the earlier economic releases for the antipodean pair.
Declining Ecostats Left AUD and NZD Investors Unfazed Today
The most notable recent economic announcements from Australia and New Zealand have been the Australian Private Sector Credit results on the year in December, which have reprinted at 6.6% instead of rising to 6.7 and the New Zealand December Building Permits figure, which has reduced from 2.4% to 2.3%.
Although little has changed in the Pound Sterling to Australian Dollar (GBP/AUD) exchange rate today, Sterling (GBP) has managed to snatch a lead of 0.3% against the New Zealand Dollar (GBP/NZD) this afternoon.
Recurrent Dairy Price Concerns could be Cause for Recent ‘Kiwi’ (NZD) Downtrend
With no direct economic data coming out for New Zealand this afternoon, a potential cause for the decline in value may be the news that NZ dairy giant Fonterra has cut the amount it expects to pay shareholders, due to an apparent slowdown of global demand.
The Pound Sterling to Australian Dollar (GBP/AUD) and Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rates have both fallen today, although this movement is by no means indicative of the Pound’s (GBP) general movement. Both the ‘Aussie’ (AUD) and the ‘Kiwi’ (NZD) have been rallying.
GBP/AUD, GBP/NZD Exchange Rate News: Supportive GDP Results Shore up Sterling Today
Pound Sterling (GBP) has claimed a number of victories against its competitors so far today, which have included 0.2% against the Euro (GBP/EUR), 0.3% against the US Dollar (GBP/USD), 0.4% against the Canadian Dollar (GBP/CAD) and 0.6% against the Swedish Krona (GBP/SEK).
The initiators of these Pound-positive movements today have been the UK’s Q4 GDP results. On the quarter, a rise from 0.4% to 0.5% has been seen, while although a slowdown on the year was witnessed from 2.1% to 1.9%, this nonetheless fell in line with forecasts. The Pound has lost out against the ‘Aussie’ (AUD), perhaps in line with forecasts.
It is worth noting that the data came with a sting in the tail – while overall results were positive, the construction sector was shown to be in a clear recession and services were the greatest contributor to the UK economy by far.
Australian Dollar (AUD) and New Zealand Dollar (NZD) Soar after Fed and RBNZ Dovishness
The Australian Dollar (AUD) has risen across the board today, mainly because the Federal Open Market Committee (FOMC) voted to leave the US Interest Rate at 0.50%. With the next rate decision not due until March, this has granted investors in commodity currencies a significant amount of breathing room.
‘Aussie’ gains today have included 0.3% against the Pound Sterling (AUD/GBP), 0.4% against the New Zealand Dollar (AUD/NZD) and 0.8% against the US Dollar (AUD/USD).
The New Zealand Dollar (NZD) has also risen of late, with both the Fed’s interest rate freeze and the Reserve Bank of New Zealand’s (RBNZ) rate decision providing the impetus behind the advance.
‘Kiwi’ movement has included limited movement against the Pound Sterling (NZD/GBP), a loss of -0.4% against the Australian Dollar (NZD/AUD) and an advance of 0.4% against the US Dollar (NZD/USD).
GBP, AUD, NZD Exchange Rate Forecast: Relatively Quiet Close to the Week Expected
All three currencies in question have economic data due before the weekend, although none of the data on offer seems likely to generate any major shifts of its own volition.
First up will be New Zealand’s December Building Permits results, due out tonight. Following on from this tomorrow will be the early Australian Private Sector Credit report for December, which is forecast to rise from 6.6% to 6.7% on the year.
Finally, around the same time will be the UK’s Gfk Consumer Confidence Survey which is forecast to fall from a pair of points to a single one.
Current GBP, AUD, NZD Exchange Rates
The Pound Sterling to Australian Dollar (GBP/AUD) exchange rate was trending in the region of 2.0225, the Australian Dollar to Pound Sterling (AUD/GBP) exchange rate was trending in the region of 0.4946, the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate was trending in the region of 2.2151, the New Zealand Dollar to Pound Sterling (NZD/GBP) exchange rate was trending in the region of 0.4517, the Australian Dollar to New Zealand Dollar (AUD/NZD) exchange rate was trending in the region of 1.0953 and the New Zealand Dollar to Australian Dollar (NZD/AUD) exchange rate was trending in the region of 0.9135 today.