A More Encouraging Week for the British Pound?
Posted by Allison on 5 April 2016, 11:40
Welcome back to our first report after the Easter break, which takes into account the second four-day week that began after Easter Monday. How would the British pound fare in this second short week?
An overview of the currency markets for March 28th – April 1st 2016
After a relatively poor week last week, we were hoping for something much better this time around. We had one day less in which to do it, as the Easter weekend gave us a day off on Monday. Come Tuesday morning, the British pound got things started again on 1.4130 against the US dollar. This climbed encouragingly to 1.4268 on Tuesday, before leaping up still further to an impressive 1.4410 on Wednesday evening. While that turned out to be the sum total of improvements this time around, the pound still ended the week in better shape than it had started it. Friday’s closing rate, to begin April, was 1.4309.
The pound began with a rate of 1.2668 against the euro on Tuesday morning, and did well here to begin with, too. It went up to 1.2746 by the end of the day, before dropping to 1.2725 the following day. It turned out that initial improvement was as good as things would get. The final two days of the week, as March turned into April, saw the pound slide to 1.2517. On this occasion, the euro had come out on top.
Our third stop will determine whether the pound has anything to stand up against the Hong Kong dollar with. The opening rate was 10.964 – again, after a poor week last week. But Tuesday and Wednesday saw a much healthier performance from the pound, as it rose to 11.068 and 11.174 respectively. We then saw a dip similar to the one we’d seen against the euro, though, which meant by the time the week was done, we had slid back to 11.096. At least this was better than the opening rate had been four days previously.
So what would happen in New Zealand? The pound got started on 2.1086 on Tuesday morning, and the early news was encouraging. It finished on 2.1156 that day, but it soon became clear it had peaked too soon. Just 24 hours later the pound was down to 2.0814. Could it improve by Friday? Actually, no – by that time it had finished on 2.0675 – registering a total loss of just over four cents.
Would this pattern be repeated against the Australian dollar as well? We certainly had a good start, as the pound went from 1.8822 on Tuesday morning to 1.8994 that night. But we then saw the same drops we had elsewhere, and by Friday night the pound was only worth 1.8630 against the Australian dollar. Not quite as big a drop as we’d seen against the Kiwi dollar, but a drop nonetheless.
Notable events in the world of currency
A slight loss against the Canadian dollar
The pound did well in some areas this week, but not against the Canadian dollar. Here, the pound managed to start on 1.8775 but it could only finish on 1.8643 by the time the week was over.
Another drop against the Swiss franc
There was bad news here too this week, as the pound went from 1.3776 to 1.3701 by the time the four trading days had ended.
One good day followed by three bad ones against the Icelandic krona
We have seen this pattern already this week, and we are seeing it again here now. The pound began on 177.880 and finished up lower on 175.427.
Perhaps the pound didn’t start April in the best condition, but it certainly did well in some areas. Compared to last week, this piece of good news was definitely worth waiting for. Perhaps we will see different outcomes next week, as the pound faces off against these same currencies again. Whatever happens, we will report back with the latest information as soon as we can.