A Concerning Week for the British Pound
Posted by Allison on 10 February 2014, 15:48
It’s time to see how the British pound performed in the first week of February. Christmas is long since forgotten and the pound has had a full month to trade with the rest of the world. How would February fare as the first week gets underway?
An overview of the currency markets for February 3rd – February 7th 2014
The start of a new month did not come with good results for the British pound – at least not where the battle with the US dollar was concerned. The opening rate was 1.6455 and this immediately dropped to 1.6343 by the end of day one. Would this be the way things would progress during this week? Another drop of nearly half a cent the following day certainly didn’t bode well and by Wednesday the pound had fallen further to 1.6273. Fortunately it did then start to pick up and managed to creep back up to 1.6326 by Friday evening. This was still considerably down on the beginning of the week though.
As it turned out we had a similar position coming up against the Euro as well. Here we began on 1.2175 and slid back to 1.2062 by Tuesday evening after two poor days. The lowest rate here also came on Wednesday as the pound closed on a poor 1.2016. We did improve a little to 1.2066 the following day, but we couldn’t make it two days in a row, instead finishing on 1.2027.
We had a surprising start against the Hong Kong dollar, rising to 12.787 after a start of 12.780 on Monday. However we were soon on the back foot again, falling to 12.661 on Tuesday before sinking lower to 12.631 the following day. We did at least manage two more encouraging days before the week was over. This meant we ended up with a finishing rate of 12.693 on Friday.
Let’s travel to New Zealand now to see if there was any better news to be had over there. The opening rate was healthy enough at 2.0310 but we soon had familiar news coming our way. By Monday night the New Zealand dollar had pushed us back to 2.0151. There was worse news to come as well as we steadily lost ground over the next few days. The low point came on Thursday as we dipped as low as 1.9779, but we barely recovered the following day as the week ended on 1.9800.
We barely expected any good news from Australia, and indeed we had a disappointing time here as well. We opened on 1.8890 and promptly dropped back to close out the day on 1.8580. There was worse here as well though, much as there had been against the New Zealand dollar. We hit a low point of 1.8161 on Thursday before edging up slightly to finish Friday night on 1.8255. Clearly this was not a good week.
Notable events in the world of currency
Another drop against the Canadian dollar
The pound had no good news for us here, falling from 1.8422 to 1.8081.
A slight drop against the Swiss franc
At least the rot here was marginal, seeing us fall from 1.4877 to 1.4718.
And a smaller drop against the Icelandic krona
The drop here was smaller too, going from 188.854 to 188.709.
Well it was hardly a memorable week for the British pound, as we lost ground in every single country we normally focus on. The losses were not small ones either, amounting to a considerable amount in many areas. We can scarcely remember a time when we had losses as big as those we have seen against the Australian and New Zealand dollars this week.
Needless to say we shall be keeping a close eye on the markets and we will report back next week to see if we can provide you with some better news. We can only hope the pound manages to reap back some of its losses – but it may take a while to achieve that.