Pound-to-New Zealand Dollar Rate Breaking Down into New Lower Range, but Nears Support

The Pound-to-New Zealand Dollar rate was on the back foot Friday as Sterling returned to the bottom of the major currency bucket, furthering a multi-week breakdown into a new, lower trading range although the exchange rate will soon meet with a formidable technical support level that might slow the descent. 

The New Zealand Dollar hit a fresh four month high against Pound Sterling over the course of the past 24 hours, with the Kiwi finding a steady bid amidst an increasingly entrenched global economic recovery story.

The New Zealand Dollar is forecast to outperform the Australian Dollar over coming days by strategists at a global investment bank, a view which if correct would suggest the potential for outperformance by the Kiwi against other peers such as the Dollar, Euro and Pound.

The Pound-to-New Zealand Dollar rate spiked Thursday on better-than-expected UK economic figures but with voodoo monetary policy becoming fashionable at the Bank of England (BoE) as well as Reserve Bank of New Zealand (RBNZ), fresh losses could be just around the corner.

The New Zealand Dollar is the best performing major currency of the day as markets rapidly scale back expectations that the country's central bank could introduce negative interest rates to help float the economy.

The Pound-to-New Zealand Dollar rate slipped Tuesday as the Kiwi outperformed while Sterling lagged its antipodean counterparts, continuing a trend that threatens to progressively sink the exchange rate in the absence of further action from the Reserve Bank of New Zealand (RBNZ).

Pound Sterling's recent retreat against the New Zealand Dollar is likely to extend over the course of coming days, according to technical readings of the market and an assumption that the current recovery in global markets and commodity prices extends.

The Pound-New Zealand Dollar rate is in the process of topping out and could soon  target the 200-day average while risking a move below it despite the Reserve Bank of New Zealand (RBNZ) dealing a blow to the Kiwi this week.