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NZD Fluctuates on Political Instability

Friday’s high: NZ$1.8164

Friday’s low: NZ$1.7906

NZD/GBP Losses Caused by Gathering Labour Momentum

Political news weakened the New Zealand Dollar yesterday, with a strong performance from Labour’s Jacinda Ardern keeping the election race unpredictably close. Although dismissed as ‘stardust’ by defending National Bill English, Ardern quickly repurposed the word into a rallying phrase for her party.

The Pound also gained on the New Zealand Dollar thanks to the National Institute of Economic and Social Research (NIESR) upgrading its Q3 UK GDP estimate.

UK News to Drive GBP/NZD Volatility

UK economic news will be centre stage this week, with traders waiting for inflation stats on Tuesday, jobs figures on Wednesday and a Bank of England (BoE) policy meeting on Thursday.

If UK inflation falls and wages rise, the current wage squeeze will be reduced, which could inspire a higher GBP/NZD exchange rate. Additionally, any signs of confidence from BoE policymakers could also bring on Pound appreciation.

The only notable NZ news this week will be Thursday’s business activity measure. The August PMI is set to rise marginally, which may be enough to secure a small NZD advance.

Key Events

12th September

09:30 UK Inflation Rate

13th September

09:30 UK Average Earnings Growth

09:30 UK Unemployment Rate

14th September

12:00 UK Bank of England (BoE) Interest Rate Decision

23:30 NZ Business PMI

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To keep up to date with the New Zealand Dollar, visit the NZD blog in our Currency News section.

Joe Mayhew

Senior Currency Broker
T: 01442 892 060

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