Sterling strengthens vs. kiwi despite FTSE falls

Sterling strengthened against the kiwi yesterday after concern surfaced that the RBNZ would be slow to raise interest rates after the World Bank said the recession will be deeper than expected.

• The pound strengthened against the kiwi yesterday despite falls on London equity markets.
  
• Nevertheless, the Washington-based World Bank’s prediction that the world economy would contract 2.9% in 2009, rather than the 1.7% decline previously forecasted, weighed on higher-risk currencies like the kiwi, to the benefit of sterling.