WELLINGTON: Despite the positivity of some post-referendum data the Pound has struggled to maintain a bullish trend against rivals, particularly with risk appetite boosting the New Zealand Dollar
The British Pound experienced considerable gains against the New Zealand Dollar on the final day of trading, though this is mainly due to damaging NZ data coming out. For the NZD the drop in retail and base card spending on the month in August has severely lowered confidence in the currency, due to formerly positive figures falling into negative ranges for both fields.
This has been to the benefit of the GBP, which has elsewhere seen losses against peers due to a still-negative construction output figure on the year in July. The GBP/NZD exchange rate moved away from the week’s worst levels on Thursday afternoon as the market’s bullish appetite for the risk-correlated New Zealand Dollar faded.
Investors drew their attention towards the Euro on Thursday afternoon following a surprisingly hawkish ECB meeting. This and a better-than-forecast US jobless claims report saw some investors stepping away from risk for the day. Even though Pound Sterling (GBP) got off to a solid start this week the mood towards the currency has generally deteriorated, with Brexit uncertainty returning to the fore the Pound has fallen against the Euro, US Dollar and New Zealand Dollar.
July’s UK production data offered a mixed picture of the domestic economy, encouraging more investors to profit take as the impact of the referendum is likely to continue hanging over the Pound for the foreseeable future. As risk appetite has also been on the up this saw the Pound Sterling to New Zealand Dollar (GBP/NZD) exchange rate weaken further, sliding into the region of a fresh three-week low.
