Pound to New Zealand Dollar Forecast: 2.0476 in Three Months

GBPNZD can consolidate following a period of losses that have left it deeply oversold.

The New Zealand Dollar faces a "longer and tougher fight" according to the most recent analysis of the currency from the global banking giant HSBC.

The British Pound continues to undergo a corrective pullback against the New Zealand Dollar that can extend further over the coming days, although Thursday's Bank of England decision and some important data releases out of New Zealand will offer two-way volatility.

The New Zealand Dollar's decline could be done according to new forecasts from Westpac, the lender and investment bank.

The Pound has fallen 2.30% from its 2023 highs against the New Zealand Dollar thanks to a recent cooling in Bank of England interest rate hike expectations and improved sentiment towards China.

The Pound to New Zealand Dollar exchange rate remains in a broad multi-month uptrend but short-term is subject to a pullback.

GBPNZD remains in a strong uptrend, short- and medium-term favour gains, empty calendar leaves central bank divergence in focus.

GBPNZD starts the new week on the defensive but there is a high likelihood that losses will be recouped over the coming days.

GBPNZD in a technical uptrend, 2023 highs can be retested and broken, but UK jobs report on Tuesday and RBNZ on Wednesday are risks.

Analysis from Capital Economics shows the New Zealand Dollar is likely to struggle as the Reserve Bank of New Zealand will likely lead the next interest rate-cutting cycle, a development that is potentially not too far given fresh warnings from a domestic bank that the economy faces a double-dip recession.

The New Zealand Dollar begins the new week with a notable gain against most G10 currencies, extending its upward momentum from Friday, supported by a firm Asian equity market session and positive investor sentiment.

"Narrowing interest rate differentials reduce a key NZD tailwind" - ASB.

GBPNZD uptrend firmly entrenched, restest of 2023 highs likely near-term.

Relief for New Zealand Dollar sellers might be in prospect in the second half of 2023 according to Westpac which has released forecasts showing a recovery against the British Pound.

GBPNZD sees 2023 high close by, technical studies remain bullish, UK inflation and Bank of England pose two-way risk.

GBPNZD has unwound overbought conditions, but momentum remains positive on most timeframes. Watch NZ current account and GDP data this week, UK jobs and GDP data also pose key risks.

The New Zealand Dollar has pared away some of its late May losses and could further undermine the bullish trend in GBP/NZD if the Kiwi economy comes across as more resilient than its UK counterpart over the coming week but there are also numerous risks that could yet sustain Sterling near its recent highs.

GBPNZD was overbought, consolidation likely, multi-week GBP upside still preferred.

The Pound to New Zealand Dollar exchange rate was ridden down to the lowlands of its May range last week but could get an opportunity rally back above the 2.0 level in the days ahead if either UK economic data is obliging, or if the Reserve Bank of New Zealand (RBNZ) stays April's interest rate course.

The Pound to New Zealand Dollar rate could be volatile around the 2.0 level in the days ahead and vulnerable in the weeks thereafter as China's Renminbi migrates along a southbound highway in response to growing concerns in the market about the outlook for the world's second-largest economy.