GBP/NZD Outlook: Likely to decrease, as the rate is below its recent average and near recent lows, indicating weakness in the pound.
Key drivers:
- The Bank of England's cautious approach to rate cuts, with expectations of further reductions, puts pressure on the pound.
- The New Zealand dollar's performance is affected by ongoing global trade tensions, including U.S. tariffs on New Zealand exports that may hurt its economic outlook.
- Anticipation surrounding the upcoming New Zealand general election could also lead to uncertainty, influencing the NZD's value.
Range: GBP/NZD is likely to hold within its recent range, as current conditions provide little motivation for significant movement.
What could change it:
- An unexpected positive shift in UK economic data or an increase in investor confidence could boost the GBP.
- Any surprise rate cuts from the Reserve Bank of New Zealand could weaken the NZD further, impacting this pair negatively.