New Zealand Dollar Forecasts Tell of Kiwi Economic Struggle amid Year of Border Closures 

The New Zealand Dollar struggled against some major currencies Friday but analyst commentary and forecasts suggest it could underperform many for almost the next year as the Kiwi economy is burdened by cumbersome border closures that are set to remain in place until the end of 2021. 

The Pound-to-New Zealand Dollar rate came within touching distance early September highs on Wednesday even as the Kiwi emerged as the second best performing major currency, with Sterling having outpaced rivals amid renewed speculation suggesting a Brexit trade deal could be near.

The New Zealand Dollar was closing in on an important technical support level against the U.S. Dollar on Tuesday having sustained losses against all other major currencies as risk appetite faltered and after the Reserve Bank of New Zealand (RBNZ) helped squash domestic bond yields. 

The outlook for the New Zealand Dollar has improved on the result of the weekend's general election that saw the incumbent Labour Party secure an unexpected all-out majority, however analysts maintain a view that domestic interest rates policy and the U.S. election will remain key factors for the Kiwi over coming days and weeks. 

New Zealand’s Dollar edged higher from low levels against major currencies on Friday and could be priced for perfection ahead of a weekend election that’s seen returning Prime Minister Jacinda Ardern to Premier House, although some analysts have warned of downward risks for the coming days. 

Postal voting is already underway to determine New Zealand's 52nd parliament, with polling stations across the country set to open on Saturday, October 17.

The New Zealand Dollar was the worst-performing major currency at the start of the new week, going lower against all its G10 peers in sympathy with its Australian cousin which was in turn impacted by developments in the Chinese financial system.

The Pound-to-New Zealand Dollar exchange rate hit its highest level since September 07 on Thursday after members of the Reserve Bank of New Zealand ratcheted up expectations for negative interest rates, while a broad-based rally in Sterling on Brexit developments lifted most GBP-exchange rates.