Listen to the latest market mood for the GBPNZD pair.
Weak GBP, Strong NZD
The outlook for the GBP remains bearish. The UK has until the end of June to agree on an EU-UK extension. If the UK fails to agree to an extension that makes a ‘hard’ Brexit more likely. This outcome would result in the GBP weakening.
The outlook for the NZD is strong as New Zealand officials said on the weekend that no-one in the country has an active coronavirus case. If the country can’t find a case in the next week they will declare that COVID-19 is locally eradicated on June 15. This is great news for the NZD and will likely result in strength as New Zealand can focus on opening up its economy.
Therefore, expect GBPNZD sellers on pullbacks.
We expect this outlook to play out over the next 2-4 weeks as long as the reasons for the trade remain.
Main Trade Risks
The main trade risk is if the UK and the EU agree a trade deal or an extension is granted before the end of June.