Despite an improvement in Britain’s unemployment rate, the Pound to New Zealand Dollar (GBP/NZD) exchange rate continues to see volatile movement today.
Optimistic market sentiment continues to support the New Zealand Dollar. The Pound’s recovery attempts lack drive amid a lack of surprising upside factors, which is making it harder for the pair to sustain gains.
Today’s UK job market report failed to boost Sterling much. This is because concerns persist about signs that more people are stopping looking for work, and the number of UK workers on payrolls dropped.
Last Week: ‘Kiwi’ Capitalises on Sterling Selloff
Investors continued to sell the Pound from its best levels in profit-taking last week. The British currency plummeted as a combination of profit-taking and UK vaccination rollout uncertainty weighed on Sterling.
Britain’s vaccination scheme is further along than those of many other economies. However vaccinations have not remains as fast as some economies, which has caused the UK to fall behind a little.
The Pound remains broadly appealing overall though. Expectations that the UK economy will recover strongly towards the end of the year keep Sterling appealing.
The relatively risk-correlated New Zealand Dollar was strong on rising market sentiment throughout the last week.
Three Things to Watch For This Week
- Inflation Rate Reports
New Zealand’s Q1 inflation rate report will be published during Wednesday’s Asian session, and UK inflation will be published during the European session. Surprising inflation data could influence central bank speculation.
- UK Retail Sales Results
CBI will publish retail data on Thursday, with official UK retail stats following on Friday. Surprising shifts in UK consumer activity could have a big impact on the Pound outlook if they surprise.
- UK PMI Projections
Markit will publish UK PMI projections for April on Friday. In particular, the services projection is likely to be influential due to the British economy’s reliance on its key services sector.
There are still many key UK ecostats due for publication in the coming sessions. These, as well as potential shifts in coronavirus and risk-sentiment, will drive the Pound to New Zealand Dollar (GBP/NZD) exchange rate for now.