The Pound Sterling to New Zealand Dollar exchange rate currently stands at 1.9926, ranging from a low of 1.9927 and a high of 2.0034. The movement is currently around -0.34% (12:39 GMT) which is likely a result of unfavourable New Zealand unemployment data printed early this morning.
The Pound has been gaining strength against many of the majors since yesterday’s release of the UK services PMI.
The data proved to be positive; hitting 59.1 compared to the forecasted figure of 58. This positive data has sparked speculation that the Bank of England (BoE) could raise interest rates before the close of the year.
Traders invested in the Pound will be bolstered by the positive data given the less-than-ideal manufacturing figures published last week.
The ‘Kiwi’ softened against many of the majors today following the publication of employment data earlier this morning. Initially the figures looked positive, with the unemployment rate having dropped to 5.6% instead of coming in at the 5.8% forecast, compared to the previous figure of 5.9%.
Ordinarily this would be a positive drop, albeit relatively insubstantial, but this data was coupled with the publication of the participation rate which changes the initial positive outlook dramatically.
Although expected to rise from the previous result of 69.2% to 69.3%, the participation rate took an unexpected dive with actual data coming in at 68.9%. The drop in participation means that, whilst the unemployment figure has decreased, the proportion of people in the labour market also decreased.
The New Zealand dollar shifted from bad to worse after an 8.4% drop in the Global Dairy Trade auction.
Dairy product prices deteriorated to the lowest level since October 2012 at the latest auction. This has a significant impact on the ‘Kiwi’ as dairy exports account for a large percentage of the New Zealand economic output.
The Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate has today hit a high of 2.0033.
The pairing’s rate of exchange is likely to be affected this week in the wake of some upcoming data releases. The Bank of England asset purchase target for July was 375 billion Pounds and is forecast to remain the same. Also the BoE will be revealing their rate decision. The Benchmark interest rate currently stands at 0.50% and it has been predicted that the rate will stay the same.
Looking forward to next week, there will be some important data releases for the NZD.
New Zealand Card Spending and Retail Card spending reports have no forecast figure as yet, but stand at 0.5% and 0.0% respectively. The REINZ House Price Index is sure to impact but again has no forecast figure as yet.
Wednesday of next week will see the release of several important UK data reports; Claimant Count Rate, Jobless Claims Change, Average Weekly Earnings, Weekly Earnings Ex Bonus, ILO Unemployment Rate and Employment Change reports are ones to consider if you have a vested interest in the Pound.
None of these reports have forecast figures currently.
The Pound Sterling to New Zealand Dollar (GBP/NZD) is currently trending in the region of 1.9914.