The New Zealand economy is entering a period of slow growth as the economy is past its prime according to Dominick Stephens, the chief economist at Westpac bank. The economy was at its strongest a couple of years ago and its now entering its mature phase according to the economist.
The slowing economy growth can be put down to a cooling housing market and the construction sector slowing down. Population growth has also cooled which has had an impact and there are also increasing concerns surrounding the Chinese economy cooling off, which would impact both the New Zealand and Australian economies.
There aren’t any rate hikes expected from the Reserve Bank of New Zealand until perhaps late next year, and if the US President Donald Trump carries out the protectionist plans he’s warned of I think we could see the NZD negatively impacted.
Moving forward I expect to see the New Zealand Dollar come under pressure as we’ve we seen for much of this year when take a medium term view. The Pound to New Zealand Dollar rate is currently trading close to a 1 year high, and I wouldn’t be surprised to see the pair breach 2.00 later this year providing the Brexit plans go to plan.
There are no data releases from New Zealand this week, so I expect sentiment to continue to drive NZD exchange rates.
If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on [email protected] and I will endeavour to get back to you as soon as I can.