Sterling to New Zealand Dollar rates of exchange, really all of Sterling’s major currency pairings, have suffered heavy losses today in the very early hours of the morning.
Theresa May, the Prime Minister of the UK, made comments about the Brexit on a Sky News interview which made tentative steps towards a hard brexit in the minds of the global currency markets.
Frankly, her wording was actually rather vague and little in the way of specifics was released. However, a nervous market struck again and the Pound plummeted.
People can hardly be blamed. The last time strong rhetoric hinted at a hard Brexit was in October, by the likes of Francois Hollande, the French President, and Angela Merkel, the German Chancellor, and Sterling fell in what was called the Flash Crash.
Luckily, this time automatic trading algorithms did not cause something so excessive as a fall on Sterling. Given that the news was released on Sunday, automatic and immediate orders to sell off the Pound to protect investors were placed to go through as soon as Asian markets opened on Monday.
By 3am UK time, GBP/NZD was down to 1.73 from 1.76 last Friday.
Markets have since calmed down, and frankly, there is a silver lining that GBP/NZD only fell 1.5% compared to 5+% when similar comments were made in October.
The expectation is still for a form of resurgence later this week, with positive data sets on Wednesday expected for the UK economy, alongside the now long-awaited ruling for the Supreme Court on Parliament’s role in the Brexit vote.
With so much yet to come, and with Sunday’s proof that the landscape for buying New Zealand Dollar rates can change, GBP/NZD buyers may be wise to discuss their specific transfer requests with me through email on [email protected]. We can discuss a strategy to seize further improvements, and one which compliments protection against potential falls.