NZD/GBP struggling for further gains - Westpac

NZD/GBP’s rally since Dec is faltering, with 0.5350 a major obstacle, according to Imre Speizer, Research Analyst at Westpac.

Key Quotes

“Brexit risks continue to exert downside pressures. In the latest iteration, the EU said it was making contingency plans in the event of a no-deal outcome. GBP’s key event risk during the remainder of Jan will continue to be the Brexit negotiations.”

“3 months ahead: The BoE has said that Brexit is their key concern for the UK economy and is a factor behind their glacial policy grind towards a 1.00% policy rate into late 2020. Medium term direction thus depends largely on whether the uncertainty from Brexit eventually causes a slowdown in activity. If not, then NZD/GBP could head lower towards 0.50.”