GBP/NZD Exchange Rate Falls on Weakest Christmas Retail Sales Since 2008
The Pound New Zealand Dollar (GBP/NZD) exchange rate is down today and is currently trading within the region of NZD$1.8784.
The Pound (GBP) was weakened against the New Zealand Dollar (NZD) after the release of the UK’s year-on-year BRC like-for-like real sales for December which decreased by -0.7% in the worst Christmas trade since 2008.
Pound investors were also left skittish today as Labour leader Jeremy Corbyn demanded a general election to ‘break the deadlock’ over Brexit between Parliament and Prime Minister Theresa May.
Corbyn also called for other MPs to vote alongside Labour in a vote of ‘no confidence’ in the government should May’s deal be voted down on Tuesday, which has further dampened sentiment in the Pound.
The New Zealand Dollar gained against the Pound today after US-China trade discussions ended on a positive note yesterday, with China’s Commerce Ministry commenting that the discussion had ‘established a foundation for the resolution of each others’ concerns’.
These gains, however, were somewhat muted by the release of China’s year-on-year PPI for December which decreased by -0.9% against, potentially indicating a slowing down of the Chinese economy.
New Zealand Dollar investors, however, will be looking ahead to today’s release of the seasonally-adjusted building permits figures for November, with any signs an increase potentially enabling the ‘Kiwi’ to claw back some of its losses.
Pound New Zealand Dollar (GBP/NZD) Exchange Rate Falls as Former MI6 Head Warns against May’s Brexit Deal
The former head of the MI6, Sir Richard Dearlove, has written to Conservative chairs in an attempt to dissuade them for voting for Theresa May’s Brexit deal on reasons of ‘national security’, telling MPs to ‘vote against this bad agreement,’ a development that has made some Sterling traders nervous.
Today also saw the UK Business Secretary, Greg Clark, urge Theresa May to avoid a ‘no-deal’ Brexit situation, commenting that ‘hundreds of millions of Pounds’ are being poured into ‘no-deal’ planning, saying that this ‘is a time for Parliament to come together and work intensively to establish an agreement that can command majority support.’
Theresa May has signalled that she will accept Labour’s amendment to secure workers’ rights in a clear attempt to bolster MPs’ support for her Brexit deal, however this has been dismissed by Jeremy Corbyn, causing further volatility for Sterling as divisions mount ahead of next week’s vote.
GBP/NZD Outlook: UK GDP in Focus
GBP investors will be looking ahead to tomorrow’s slew of UK data releases, with Sterling potentially benefiting from the release of the manufacturing production figures for November, which are expected to increase.
These, however, will be followed by the release of the UK’s goods trade balance for November which is expected to decrease, potentially dampening sentiment in Sterling.
However, the Pound could recover if tomorrow’s publication of the UK’s GDP figures show any signs of better-than-expected growth.
Tomorrow will see no New Zealand data releases, with ‘Kiwi’ investors looking ahead to next Monday, when we will see a raft of Chinese data releases.
Monday will also see the release of New Zealand’s Q4 NZIER business confidence figures.
However, with Brexit debates heating up ahead of Tuesday’s vote, GBP investors will be paying close attention to any signs of Theresa May’s deal likely to be rejected, which could see the GBP/NZD exchange rate plummet.
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