Sterling has made further gains against the NZD during the early part of the trading week, with GBP/NZD rates moving through 1.95 overnight.
Despite the NZD finding some support around that level, it is struggling to make any real impact against the Pound.
This is somewhat surprising, considering how much pressure Sterling has been under against the other major currencies of late. The Pound has seen loses, ins some cases aggressive ones, as the UK economy continues to muddle forward in the wake of Brexit and an uncertainty over its economic future.
To put it in perspective Sterling is now trading over 10 cents higher than it was at this time last month, which proves how unpredictable the current market remains.
In monetary terms this equates to an additional 20,000 NZD if you were transferring £200,000 now, compared to last month.
The reason for the current spike in Sterling’s value is likely to do with a major crisis of confidence in the New Zealand economy, which is inadvertently boosting the Pound’s value.
Investors have been pulling their funds away from the NZD ever since the recent political changes in New Zealand, where Labour leader and new Prime Minister Jacinda Ardern has taken power.
Due to her unpopular policies amongst the main stream economists and some would say even radical stances on a majority of issues, investors have shied away from the NZD.
The upturn for the Pound is somewhat fabricated due to this lack of confidence in the NZD and as such, the Pound remains fragile in my opinion.
We also need to consider how the markets may react to tomorrow’s UK Autumn budget. Whilst this generally does have a significant impact on the currency markets, UK Chancellor Philip Hammond is under pressure following the last budget in March, which was widely criticised.
For this reason I would be very tempted to take advantage of the current highs, which would not be available had the political situation in New Zealand been more stable.
If you have an upcoming GBP or NZD currency transfer to make you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.
Our award inning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.
Feel free to email me directly on [email protected] to find out all the options available to you ahead of your currency transfer.