The Pound has fallen lower against the New Zealand Dollar on Friday afternoon’s session, following news of strong imports in China. For the GBP NZD exchange rate, this has meant a -0.6% decline to 1.8490.
As well as Brexit uncertainties weighing on the Pound, the UK currency has also been outperformed by a surging NZD.
An 18.7% rise in Chinese imports has bolstered the New Zealand Dollar today, as this has highly positive implications for national economic growth.
(First published October 13th, 2017)
Pound Forecast to Fall if EU Officials Blast Brexit Process
Although the Pound has appreciated recently on Brexit optimism, this could only be temporary. Looking ahead, a key meeting of EU officials will take place next week.
This may send the Pound plummeting down, as it will pertain to the UK’s progress in Brexit talks so far.
EU leaders will looking at how far the UK has come in talks and whether it can proceed to discussing trade deals, but the preview does not look positive.
In a draft statement to be made by EU leaders, officials appear poised to deny UK negotiators the chance to discuss a transitional deal because of too little progress.
Such a statement could simply reinforce the idea that the UK is stuck in talks, as the ‘official’ exit date of March 29th, 2019 gets closer by the day.
New Zealand Dollar Outlook: Will Coalition Announcement Turn NZD Volatile?
The next major source of New Zealand Dollar movement could come next week, or by next weekend at the latest.
This will be the announcement from the New Zealand First Party, confirming how the party intends to form a functioning coalition.
NZ First leader Winston Peters has been in talks with the two majority parties, the Nationals and Labour, since the general election in late September.
Peters struck a positive tone after concluding talks with both potential partners, stating;
‘I’m very pleased we’ve got it finished. We’ve got a serious comprehensive dossier from both sides and there’s some fiscals to be shared to make sure we do agree but the substantive part for discussion has been done’
While a coalition declaration date is not set in stone, when asked if the government would be confirmed by the end of next week, Peters simply said ‘Yes’.
He has kept onlookers guessing, however, by saying;
‘I said I’d go into it with a total open mind, and I’ve asked my caucus and the board to have the same approach…I can honestly tell you I wouldn’t take a guess of what anyone is currently thinking’.
If the NZ First leadership decides to back the nationals, the NZD could rally because the country has had a National government since 2008.
If NZ First opts for Labour instead, the New Zealand Dollar may depreciate because of uncertainty about such a radical change in future policy.
Recent Interbank GBP NZD Exchange Rates
At the time of writing, the Pound to New Zealand Dollar (GBP NZD) exchange rate was trading at 1.8615 and the New Zealand Dollar to Pound (NZD GBP) exchange rate was trading at 0.5370.