This report looks at the cost of exchanging New Zealand Dollars this week and the factors that could affect your currency transfer.
The Pound fell to its lowest level against New Zealand Dollar in almost 11 weeks yesterday, after negative news on the health of the UK retail sector was released, showing a dramatic downturn in new shop openings in the UK. To add to this, UK Prime Minister Theresa May has also been forced to fight back against EU leaders who have threatened to make it impossible for the UK to leave the EU whilst maintaining free trade agreements and control of its borders, causing yet more Brexit related concerns for investors.
The Global Dairy Trade (GDT) auction, which provides the percentage change in Dairy prices was released yesterday and showed a 1.7% increase at their latest auction. An increase is seen as positive for the New Zealand economy, as Dairy products account for more than 29% of the value of New Zealand’s exports, and is therefore relied upon heavily. Although an increase was shown, this was down from expectation of a 5-10% rise, and far less than the 7.7% increase seen at the last auction two weeks ago.
This evening at 10pm, the Reserve Bank of New Zealand (RBNZ) will announce their latest Interest Rate Decision, with the expectation being that they will hold the rate at 2%. The RBNZ became the first major central bank to raise rates since the Eurozone Debt Crisis in 2009, and although they were cut last month from 2.25%, they continue to hold high above most other major central banks, providing investors with higher returns. Although it is expected for rates to remain as they are, further stimulus may be added which could weaken the NZD. As highlighted in my US Dollar update, interest rates are a catalyst for market volatility, so any clients with a pending NZD transfer may wish to secure today’s rate of exchange by booking out a forward contract, removing themselves from any adverse market movements.
For more information on how future data releases could affect a New Zealand Dollar exchange please call our currency brokers on 01494 725 353 or email me directly at firstname.lastname@example.org.
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