Negative Movement Forecast for Pound Sterling New Zealand Dollar Exchange Rate Tomorrow

May 3, 2016 - Written by Ben Hughes

STORY LINK Negative Movement Forecast for Pound Sterling New Zealand Dollar Exchange Rate Tomorrow

While the New Zealand Dollar has recently been harmed by a rising unemployment rate, the Pound is likely to be sent reeling if tomorrow's UK PMIs come out negative like the previous two.

The Pound may lose out against the currently flagging New Zealand Dollar tomorrow morning, if the negatively-forecast UK construction PMI results for April match expectations.

Risk-Off Trade saw Global Shares Decline Significantly

Yesterday was a public holiday across much of the Western world, but that didn’t equate to a lack of movement in the global currency markets. Friday’s session had brought a decidedly ‘risk off’ trading environment, which saw global shares give up a significant amount of ground; this pattern was reversed yesterday on the equities markets which were open for trading.

By the final stages of the US trading day, Chicago’s benchmark S&P 500 share index was up by 0.66% at 2,079. The European bourses which were open for business had closed up by a similar amount earlier in the day – Frankfurt’s benchmark Dax index closed up by 0.84%, while Paris’ Cac 40 added 0.31% on the day.

GBP/USD Exchange Rate Close to 1.4700

The increased levels of risk appetite came as a surprise to many analysts, given the disappointing tone of the tier one data release from the world’s premier economy yesterday afternoon. T

his month’s US ISM Manufacturing survey was expected to reveal a drop from February’s showing of 51.8, but the result of 50.8 was a miss to the downside of significant proportions.

The US Dollar (currency : USD) suffered on the day, sending the Pound Dollar exchange rate up to within a few pips of the 1.4700 GBP USD threshold.

The next potential market-mover for the Greenback comes in the form of tomorrow afternoon’s ISM survey of the non-manufacturing sectors of America’s vast economy. Expectations are elevated, with an improvement of 0.2 points on last month’s counterpart result of 54.5 anticipated. Anything less than this and Cable will head into the second half of the week eyeballing the psychologically key 1.5000 GBP USD level.

Look out for movement in the relative value of the New Zealand Dollar (currency : NZD) today. The latest fortnightly GlobalDairyTrade auction results are due out shortly; the all-important Whole Milk Power (WMP) hammer price will be the primary market-mover for the Kiwi. This evening’s New Zealand unemployment data will add to the price action for the Kiwi, with an increase in the overall level of joblessness forecast.

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TAGS: American Dollar Forecasts New Zealand Dollar Forecasts Pound Dollar| Forecasts