Data revealed a growing confidence among New Zealand businesses, which has driven the pound down further

The pound reverted back to its downward trend against the kiwi in trading yesterday, losing 0.8% to close the day near last week’s lows at 2.2163.

  • A strong jump in a New Zealand business confidence survey added to evidence that the economic recovery is gaining pace, supporting demand for the kiwi.
  • The Reserve Bank of New Zealand published a bright economic outlook yesterday, which was also picked up on by investors with expectations for a rate rise strengthening.
  • Additionally, in the US, the second quarter GDP figure was revised upward revealing that the economy had contracted by less than initially expected, which supported a move into riskier assets, although weak employment data did offset this trend slightly.
  • In trading this morning, the pound has lost further ground, with the price edging down below 2.21 as confidence in the kiwi remains strong.
  • However, analysts have stated that the New Zealand dollar may cap its advances with investors unwilling to chase the currency ahead of US payrolls and manufacturing data later this week.