A Dramatic Week for the British Pound
Posted by Allison on 12 April 2016, 16:26
We hoped to bring you some excellent results this week, but as you are about to find out, this was more difficult than we may have expected.
An overview of the currency markets for April 4th – April 8th 2016
Here we go then, with another week in the world of the British pound and its performance on the currency markets. It began with a rate of 1.4309 against the US dollar, before dipping steadily through the first three days. It wasn’t the best start, to be sure, and by Wednesday evening the pound was worth 1.4028 – a significant drop. It did manage to crawl back to 1.4076 on Thursday, but it was nowhere near enough to ensure we could regain the losses from earlier on. Finally, we slid back again on Friday, closing on a disappointing 1.4075 in the process.
So what of our position against the euro? Would we see a similar picture there? As it turned out, we would, despite an early rise from 1.2517 to 1.2541 on the first day of the week. After that, we had a couple of poor days, taking us down to 1.2375 by Wednesday evening. We perked up again come Thursday, as the pound managed to crawl back to 1.2387, but it was not enough to allow us to regain the losses on the final day of the week. Instead, the pound dipped again, this time to 1.2386.
Our third foray into the currency markets sees the pound go up against the Hong Kong dollar. From a starting point of 11.096, we managed to experience the same three poor days we’d had against the American dollar. This meant we were down to 10.880 by Wednesday evening. The same pattern meant we had a slight improvement the following day, taking us to 10.921, before the pattern repeated itself again on Friday, with the pound falling to 10.921.
Over in New Zealand, the British pound began trading on 2.0675. We actually had a good start to the week here (for once), as the pound enjoyed two good days and finished on 2.0933. We then had one bad day to wipe everything out, as the pound fell all the way to 2.0672. Fortunately, we still had two days to go, and we made the most of them on this occasion. We ended up with a rate of 2.0756 in this instance on Friday night, which was better than the one we’d started with.
Finally, it’s the turn of the Australian dollar to have a go at the pound – and it was a tussle, too. the pound began on 1.8630 and did well initially, rising to 1.8707 on the first day. Better news came on Tuesday too, with a closing rate of 1.8818. Unfortunately, Wednesday’s closing rate of 1.8598 meant we lost all those improvements. We did claw some back on Thursday before the dollar fought back to close the week. All in all, the pound finished on 1.8693, which was still a marginally better rate than it had begun the week on.
Notable events in the world of currency
A drop against the Canadian dollar
Here too there was little in the way of good news to identify. We began on 1.8643 before dipping to close out Friday night on 1.8408.
Another fall, this time against the Swiss franc
We had more bad news here as well, as the pound started the week on 1.3701 and eventually fell back to 1.3469.
Three out of three in bad results here
The Icelandic krona also got the better of the British pound last week. In this part of the world we started on 175.427, before dropping back to 174.295.
As you can see, this was far from a good week for the British currency. However, many things are combining to make it a tough time for the pound at the moment. It is perhaps the long-term view that is more important, so we shall continue monitoring the situation to see how things develop in that direction.