Buying New Zealand dollars – NZD Weakness (James Lovick)

The New Zealand dollar has come under pressure this week as global uncertainties once again weight heavy on the kiwi.

This week is light for New Zealand economic data and already the markets are focussing on the New Zealand general election in September and the French election which starts in April.

As far as GBP NZD in concerned the pound has made excellent gains today and this is likely to be on the expected news this Wednesday when UK Prime Minister Theresa May will invoke Article 50 and commence the formal process of withdrawing from the European Union. It is without a doubt the major event for the currency markets this week.

My view remains that this announcement will be put on a very large platform for the world to see which is likely to see considerable volatility for GBP NZD. If we see a repeat of when Theresa May gave her Brexit blueprint statement at the beginning of the year then we could see considerable strength for the pound against the New Zealand dollar.

Any form of greater clarity as to Brexit is in my view likely to be beneficial for the pound. A move over 1.80 for GBP NZD seems perfectly plausible although any frustration from the Scottish First Minister Nicola Sturgeon could see another element for volatility.

Those clients looking to buy New Zealand dollars would be wise to get in touch before the events of Wednesday to consider the options available. A forward contract could be well utilised to lock in a rate if there is a good jump higher and remove the uncertainty from the volatile currency markets.

If you would like further information on New Zealand dollar exchange rates or any of the major currencies and to discuss how we can assist then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively, I can be emailed directly on [email protected]