Sharechat Logo

NZ dollar gains vs pound after BoE keeps rates unchanged, cuts growth, inflation forecasts

Friday 4th August 2017

Text too small?

The New Zealand dollar rose against the British pound after the Bank of England kept its benchmark interest rate unchanged and lowered its forecasts for economic growth, inflation and wages citing the likely impact of exiting the European Union.

The kiwi dollar gained to 56.60 British pence as at 8am in Wellington from 55.96 pence late yesterday. The kiwi rose to 74.39 US cents from 73.99 cents yesterday.

BoE governor Mark Carney said the "speed limit" of the economy had slowed and economic growth this year was expected to be 1.7 percent, down from a previous forecast of 1.9 percent, while 2018 growth was cut to 1.6 percent from 1.7 percent. The pound tumbled against the euro and the greenback. The kiwi gained against the US dollar after US services sector data printed weaker than expected.

"The BoE took centre stage with the Bank downgrading its GDP and wage growth forecasts," said Cameron Bagrie, chief economist at ANZ Bank New Zealand, in a note. "The USD remains unloved and that makes it difficult to get too bearish NZD/USD."

The trade-weighted index rose to 78.17 from 77.86 yesterday. 

Traders expect the Reserve Bank will keep the official cash rate at 1.75 percent when it reviews policy next week and some see the track of interest rates being flattened even further.

"The tide is going out on market expectations for OCR hikes, but that need not necessarily count against the NZD specifically given similar themes evident in the UK, Australia and the US," Bagrie said.

The kiwi rose to 93.54 Australian cents from 93.23 cents yesterday and gained to 4.9946 yuan from 4.9780 yuan. The kiwi rose to 62.64 euro cents from 62.46 cents and traded at 81.80 yen from 81.90 yen.



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Government package for commercial leases too little, too late
Concerns over Government’s intervention in commercial leases
Development Commitment to Bowen Campus Stage Two
Vista Group International Limited - Update on the impacts of COVID-19
AFT secures Maxigesic IV® distribution in four Western European countries and reports Australasian market share gains in COVID-19 medicines
Investore Property Limited (Investore) today announced its financial results for the twelve months ended 31 March 2020 (FY20).
Rabobank GDT Analysis - Event 261
SkyCity Entertainment Group Limited - Update on COVID-19 Impacts and Recent Trading
ANZ announces sale of UDC Finance
Foley Wines Limited Announces Harvest Result, Earnings Outlook and Development in Martinborough

IRG See IRG research reports