Persisting caution in global markets is making it easier for the Pound New Zealand Dollar (GBP/NZD) exchange rate buoyant this week so far. Investors continue to find the Pound generally appealing as Britain’s economy continues to gradually reopen.
Since markets opened this week, GBP/NZD has been attempting recovery. The New Zealand Dollar has been unappealing as markets become more cautious again.
NZD investors are also awaiting tonight’s Reserve Bank of New Zealand (RBNZ) policy decision before making new moves on the ‘Kiwi’.
Last Week: Sterling Selloff Dominates Movement
As the Pound recoiled from its best levels in months against many major currencies, investors sold it from its best levels in profit-taking last week.
Sterling’s selloff was deepened slightly by concerns around Britain’s coronavirus vaccine situation. Concerns around the AstraZeneca vaccine have been rising, which has impacted Britain’s perceived vaccine rollout.
The New Zealand Dollar was fairly appealing last week on the other hand. Investors were more willing to take risks due to Federal Reserve dovishness, which bolstered NZD.
Three Things to Watch For This Week
- Reserve Bank of New Zealand Policy Decision
The Reserve Bank of New Zealand (RBNZ) will hold its April policy decision during Wednesday’s Asian session. If the bank takes a more hawkish than expected tone on the New Zealand economy, this could boost the New Zealand Dollar’s support.
- New Zealand PMIs
Friday will see the publication of New Zealand’s business NZ PMI, with the latest services PSI following on Monday. These are the only noteworthy New Zealand stats until inflation data is published a week from now.
- Coronavirus Developments
As Britain’s economy continues to gradually reopen, developments around Britain’s coronavirus situation could remain influential to the Pound. The global situation will continue to impact market sentiment and the risk-correlated NZD.
A lack of major UK and New Zealand data due for much of the coming week will leave the Pound to New Zealand Dollar (GBP/NZD) exchange rate driven mostly by RBNZ and coronavirus pandemic developments.