British Pound to New Zealand Dollar (GBP/NZD) Exchange Rate Holds near 2-Year High on Risk Aversion
As Isis terrorism dominates the media; trader risk sentiment has all but vanished. With risk aversion strategies set firmly in place currencies that are risk-sensitive, like the ‘Kiwi’ (NZD) Dollar, have lost a lot of ground. Sterling, meanwhile, is profiting from Thursday’s surge following Bank of England Governor Mark Carney’s speech.
If you're looking to make an international money transfer, we recommend TorFX.
The Pound Sterling to New Zealand Dollar exchange rate is currently trending in the region of 2.0633.
Sterling enjoyed a surge in demand on Thursday afternoon after Bank of England Governor Mark Carney made a speech in Wales. Carney suggested that many of the conditions for normalising monetary policy have been met, and rate revisions are getting closer.
Reserve Bank of New Zealand Governor Graeme Wheeler made some impromptu comments on Thursday which aided the ‘Kiwi’ downtrend. He reiterated the view that the New Zealand Dollar’s current value is ‘unjustified and unsustainable’. ‘The market has latched on to Governor Wheeler’s comments about the possible extent of the falls,’ ANZ Bank New Zealand senior foreign exchange strategist Sam Tuck said. ‘It came at a fairly opportune time as there were pretty decent support levels around 80 US cents – the market seems to have quite comfortably blown through those levels and that will now provide decent resistance.’
The Pound Sterling to New Zealand Dollar exchange rate has hit a low today of 2.0617.
Friday’s British data has printed relatively negatively although its influence on Sterling movement has been minimal. The Hometrack Housing Survey fell from 5.5% to 5.0%.
Sterling has softened against the majority of its currency rivals on Friday, but only fractionally. This could be as a result of trader profit buying after the initial surge on Thursday presented some attractive selling positions.
Another possible contributor to the Pound’s slight descent is the increasing possibility that Prime Minister David Cameron will get the go ahead to begin air strikes on Isis terrorists in Syria and Northern Iraq. British military action is likely to ignite Sterling volatility.
An absence of domestic data pertaining to New Zealand on Friday has done nothing to curtail the ‘Kiwi’ downtrend. As tensions mount regarding Isis trader risk aversion is likely to see the ‘Kiwi’ continue to slump.
Forecast for the Pound to ‘Kiwi’ Exchange Rate
Given that there are no more domestic data publications on Friday pertaining to both the UK and New Zealand; it is highly likely that the GBP/NZD exchange rate will continue to hold in a high position. The pairing could be bolstered by geopolitical unrest, but could also soften from British military involvement.