Are There Better Times Ahead for the British Pound?
Posted by Allison on 22 March 2016, 11:18
Now we know the referendum concerning the membership of the EU is set, it may mean the pound has some tough times ahead. But judging by the results we have for you this week, it may not all be bad news.
An overview of the currency markets for February 29th– March 4th 2016
With 2016 being a leap year, we have an extra day to cover this week, so to speak. Monday was the 29th, and the pound began the day on 1.3976 against the US dollar. This soon fell back to 1.3855 however, which didn’t bode well for the week as a whole. We soon discovered the week would be better than we’d assumed, though, as the remaining four days were all very good for the British pound. It improved from one day to the next, eventually reaching 1.4157 by Friday night. It was a good start, to be sure.
The question now was whether the pound could achieve the same good result against the other currencies – starting with the euro. Here, it began trading this week on 1.2699 before improving to 1.2725 on Monday. It then had two more good days, sending it up to 1.2918 by Wednesday evening. It couldn’t retain that good performance over the next two days, but even though the pound lost some ground, it didn’t lose enough to leave it in poor condition. Instead, it finished the week better off on 1.2906.
So onto Hong Kong now, and the hope that the pound could do well here as well. It began trading on 10.859 before dropping to 10.772 on day one. However, in a similar pattern to that seen against the US dollar, the pound managed to perform well for the remainder of the week. This meant the final exchange rate on Friday turned out to be 10.994 – much healthier than we’d had to start with.
Over to New Zealand next, where the pound started trading on 2.0759 on Monday against the New Zealand dollar. It rose to 2.1070 by Monday evening, and enjoyed two more good days as well, taking it to 2.1176 by Wednesday evening. While the final two days of the week were not as good, the pound still managed to close trading for the week on 2.0937 – better than we’d started with and continuing the healthy trend this week.
Finally, we go to Australia to see how the pound would perform against the dollar there. It began on 1.9398 and had two encouraging days to begin with, taking the exchange rate to 1.9532. However, the rest of the week came as a disappointment, especially since the performances elsewhere were very good. Eventually, the pound finished on a lower rate of 1.9177 this week.
Notable events in the world of currency
A marginal increase against the Canadian dollar
A seesaw week led to a good result for the British pound versus the Canadian currency. It rose from 1.8933 to 1.8993 this time around.
A better result against the Swiss franc too
Here too we saw some encouraging news this week. The pound rose from 1.3878 to 1.4065 this week.
Three out of three for the pound
Our currency did well against the Icelandic krona as well, as it edged up from 180.195 to 182.683 this week.
We can see then that for this week at least, there was some good news in store for the British currency. Whether or not it will last remains to be seen, but it is good to bring you some encouraging news, especially after the dip in fortunes we saw after the Brexit drama first came to the fore.
We have some way to go yet before the referendum, but whatever happens, we can expect to see some struggles and challenges for the British pound in the coming weeks and months. We will however be here to report on them all, so do stay tuned to see what happens next. We’ll have the news for you when it happens.