WELLINGTON: The New Zealand Dollar failed to find a rallying point on the back of the July NBNZ Business Confidence Index and June M3 Money Supply, which both pointed towards weakness within the domestic economy. Of particular concern was the sharp decline of the M3 measure, which dipped on the year from 7.3% to 5.9% and seemed to indicate that inflationary pressure is set to remain weak in spite of the RBNZ’s recent efforts.
The NZ dollar vs pound exchange rate appreciated as UK economic outlooks wane, but foreign currency investors may soon sell the New Zealand Dollar from its recent highs in a bout of profit-taking. The UK’s business situation has done little to inspire confidence among investors lately, with clear signs of concern in leading companies contributing to weakness in Pound Sterling (GBP) exchange rates.
Of particular concern, and a major contributor to the slide in the GBP/NZD exchange rate, was the news that Lloyds has decided to cut thousands of jobs and close hundreds of branches – despite some calling this coincidental, the fact remains that the decision has been taken a month after the UK decided to leave the EU.
Additionally, French outdoor advertising company JCDecaux has announced that it will be limiting future investment in the UK, though whether this is a temporary or long-term measure remains to be seen.
