Will GBPNZD hit 1.90?

The pound to New Zealand exchange rate has risen today as we get closer to understanding more about Trump’s trade plans. With an unwinding of many positions taken up on the New Zealand currency, the rates to buy NZD have really improved today for Kiwi buyer. Markets are bracing themselves in anticipation of the Trump plans on trade leading to global disruption which could spell uncertainty on currencies like the New Zealand dollar which benefit when there is a strong belief global trade is strong. If the market suddenly takes a reversal as today the commodity based currencies like the Kiwi will suffer.

Most currency investors believe the New Zealand dollar is a good bet since expectations for the Reserve Bank of New Zealand to keep interest rates high are strong. With a high-interest rate the RBNZ make the currency attractive to hold. However such expectations don’t prevent the markets from wobbling when there are any concerns over the outlook for that currency and the economy.

The pound could well weaken further in the coming weeks owing to the UK election so investors or clients looking to buy New Zealand dollars with pounds might find this rally runs out of steam before they know it. The pound could easily struggle in the run-up to the UK election and this would see the pound fall. Kiwi buyers might be looking back on this date in the coming weeks wishing they had taken advantage of these improvements.

If you wish to get some up to date news on the currency markets and the latest trends and themes please feel free to speak to me Jonathan Watson by emailing [email protected]