GBP/NZD rates have dipped since the start of the trading week, with the pair falling below 1.73 again.
Reports have surfaced regarding the UK’s upcoming Brexit and the potential fallout from these. It’s been rumoured that UK Prime Minister Theresa May will announce the end of free movement for new EU migrants to the UK.
This, alongside growing fears that Scotland will hold a second independence referendum have knocked investor confidence in the UK economy and the Pound has lost value against most of the major currencies, including the NZD.
The House of Lords are still debating the governments Brexit bill and any amendments they wish to make would have to be sent back to the House of Commons. Although we have yet to hear any indication that this will occur, any delay by the House of Lords would likely push back the triggering of Article 50, which will officially start the process of leaving the single member state.
Much of the current market sentiment is being driven by how the UK economy will perform over the coming months. Whilst Sterling has certainly gained a foothold following its downturn, there are still many unanswered questions regarding how we will facilitate our exit from the EU and what deal will be in place once we do?
This uncertainty is continuing to drive the market and the Pound’s value has been knocked more than once recently. Therefore I wouldn’t be gambling on sustainable Sterling strength under currency market conditions and look to protect any short-term GBP/NZD positions above 1.70.
Being a commodity based currency the NZD is reliant on global trade, particularly the export of its dairy products. Therefore any global slowdown due to fears of future EU economic crisis could put pressure on the New Zealand economy and as such, the current levels are still worth protecting.
If you have an upcoming GBP or NZD currency transfer to make, then we can help you navigate this turbulent market by keeping clients up to speed with all the latest developments regarding Brexit and beyond.
If you would like us to monitor the market for you ahead of a currency exchange, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on 0044 1494 787 478 and ask one of the team for Matt.
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