Dollar hits three month low against sterling as 'Brexit' fears recede
The pound strengthened after a poll ahead of Britain's European Union membership referendum next month gave a six-point lead to the "in" camp.
The New Zealand dollar hit a three-month low against the British pound as confidence builds that the country will vote to remain in the European Union, allaying fears about the impact on the economy.
The kiwi touched 45.83 British pence, and was trading at 45.96 pence at 8am in Wellington, from 46.19 pence at 5pm yesterday. The local currency was little changed at 67.65USc from 67.51USc yesterday.
The kiwi was off a touch at to 67.40USc after Fonterra issued its first forecast farmgate milk price for next season at $4.25/kgMS, at the low end of analysts' expectations, which ranged between $4.43/kgMS to $5/kgMS in a BusinessDesk survey.
The pound strengthened after a poll ahead of Britain's European Union membership referendum next month gave a six-point lead to the "in" camp, with 44% of respondents in a Survation telephone poll for online brokerage group IG saying they would vote to stay in the EU, compared with 38% who wanted to leave.
Several bookmakers also widened the odds of the so-called 'Brexit' occurring. That has bolstered investor confidence, with most economists and strategists saying a vote to leave the EU on June 23 would hurt the economy and weaken its currency.
"GBP rallied as markets further priced out 'Brexit'," ANZ Bank New Zealand senior rates strategist David Croy and senior currency strategist Sam Tuck say. "This sent the cross lower but Brexit remains a risk."
ANZ expects the kiwi to trade between 45.60 pence and 46.50 pence today.
In New Zealand today, the government's 2016 Budget is released at 2pm.
The New Zealand dollar gained to 93.92Ac from 93.72Ac yesterday, edged up to 60.64 euro c from 60.54 c, advanced to 74.51 yen from 74.25 yen and rose to 4.4336 yuan from 4.4272 yuan. The trade-weighted index increased to 72.92 from 72.83.
(BusinessDesk)
Tina Morrison
Thu, 26 May 2016
Thu, 26 May 2016
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Dollar hits three month low against sterling as 'Brexit' fears recede
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