Trading the Pound Sterling against the New Zealand dollar, the GBP/NZD is an interesting currency pair to trade even though it is not among the leading pairs in the forex market. It trades one of the most popular currencies, the GBP, against a leading commodity currency, the NZD.The GBP is considered one of the more stable currencies in the world, after the US dollar and the Euro, although it has seen considerable volatility in recent years owing to Brexit-related uncertainties. On the other hand, the NZD is a popular commodity currency as it is closely correlated with commodities, including dairy and meat which are key exports out of New Zealand.In addition, the exchange rate of GBP/NZD is heavily influenced by the release of important economic data from the UK and New Zealand, including GDP, inflation, employment rate, retail sales, trade balance, business sentiment as well as manufacturing and services sector activity. The GBP and NZD also see significant fluctuations on the announcement of changes in monetary policy and interest rates by the Bank of England (BOE) and the Reserve Bank of New Zealand (RBNZ) respectively. When the central bank hikes interest rates or adopts a hawkish approach to the monetary policy, the respective currency strengthens.