GBP/NZD Weekly Forecast: Pound New Zealand Dollar Exchange Rate Mixed as UK Unemployment Edges Lower

The Pound to New Zealand Dollar (GBP/NZD) exchange rate has been mixed since markets opened this morning. Employment change figures from the UK have shown the unemployment rate edged down to 4.7% during April.

However, investors remain cautious surrounding Sterling following the announcement that the UK’s current lockdown measures will be extended until the 19th of July.

A lack of notable data from New Zealand could leave the ‘Kiwi’ open to losses throughout the day.

Last Week: UK’s Roadmap out of Lockdown Strengthens Sterling

The Pound was trading in a mixed range against the New Zealand Dollar last week as concerns over the delta variant of coronavirus in the UK limited the appeal of Sterling.

The risk-correlated New Zealand Dollar had spent much of the week supported by an upbeat market mood, though a rise in US inflation towards the end of the week caused investors to become wary of risk-correlated currencies like the New Zealand Dollar.

The GBP/NZD pairing ended the week trending higher as GDP data from the UK for April showed a surge to 27.6% as the economy began to recover from the worst of the pandemic.

Three Things to Watch for This Week

  1. Coronavirus Developments

Following the announcement from UK Prime Minister Boris Johnson that lockdown restrictions will remain in place until July 19th in England, investors will be keeping an eye on any further developments surrounding the pandemic.

2. UK Inflation Rate

Pound investors will be looking towards tomorrow’s inflation rate figures from the UK for May which could add some much needed support to the currency if the data meets forecasts of 1.8%.

3. New Zealand GDP Growth Rate

Tomorrow evening will also see the release of the latest GDP growth rate data from New Zealand for Q1. Any indication New Zealand has re-entered growth territory would push NZD higher.

GBP/NZD Outlook

This week’s busier economic calendar for the UK will see movement driven by inflation rate and retail sales figures, along with any coronavirus developments. A quieter week for the New Zealand Dollar will see investors keeping an eye on the global market mood in the coming days.

Georgina Clissold

Contact Georgina Clissold