The New Zealand Dollar reached a near 12 month high against Sterling today as the rate continued to fall towards the low 2.06. There is a lot of speculation around whether or not the NZD will continue to strengthen in the coming weeks after a very strong month. I am of the opinion that it is a real possibility the NZD will continue to fall and could well drop below 2.00 in April.
The Reserve Bank of New Zealand is tasked with trying to control inflation and currently the NZD strength is making exports more expensive. Whilst the NZD is also heavily associated with the Chinese markets there will always be a level of vulnerability, especially when the likes of Standard and Poor decrease China’s rating. However whilst China has received negative news in the last week the NZD has strengthened against Sterling.
The Brexit fears are causing major concerns amongst UK investors and the Leave campaign is starting to gain ground on the Stay vote. Sterling’s decline across all currencies has been dramatic and has not shown any signs of slowing after losing several points in weeks. New Zealand also has had positive unemployment figures indicating the country is producing its own momentum.
In the very short term I think the NZD is unlikely to fall as fast as currently, however over the next few months there is little that could bring a surprise. If you need to buy NZD in the coming months I suggest you get in touch as I may be able to help save you money on your transfers. Please send me an email at [email protected]