Not the Best Start to the New Year for the British Pound
Posted by Allison on 12 January 2015, 16:14
Here we are with the first whole week of trading in 2015. Would the pound make it count?
An overview of the currency markets for January 5th – January 9th 2015
So here we go with another week, this time the first full one for the New Year. The British pound began on 1.5439 against the US dollar and unfortunately it did not get the start it would have hoped for. Instead it actually went through four whole days of losses against the dollar. By the time Thursday evening arrived we suddenly found ourselves on a rate of 1.5065. This is a massive drop over the course of a few days, and one that will no doubt have worried some people. However there was a small amount of good news on Friday, as the pound clawed back some of those losses – albeit far from all of them. It finished the week on a still disappointing rate of 1.5146.
The question now was whether we would see a similar drop against the euro. Our opening rate here was 1.2820 and the pound did start to drop over the first couple of days here too, falling to 1.2751 by Tuesday evening. The good news was that would be as far as it would drop, because there were three more promising days of trading up ahead. As a result the week ended on 1.2822 for the pound versus the euro – just a marginal amount up on the opening day.
Which way would things go against the Hong Kong dollar though? The pound opened on 11.974 and it very soon became clear the pound would follow in the footsteps of the pattern it had set up against the US dollar. This meant four days of losses followed by one slightly better result to finish things off. The closing rate on Thursday night was 11.684 before the pound pulled it back to 11.744. This was however still much lower than the week had started with.
So now we move on to see whether the pound could achieve anything of note against the New Zealand dollar. It began on 2.0011 but by Monday night this had dropped to 1.9822. It seemed as if the pound could not perform at all well this week if it was up against a dollar currency of some kind. Indeed, the pattern we have already seen was borne out here as well. By Thursday the pound was down to 1.9348 before picking up slightly to 1.9380 by Friday evening.
Finally it’s the turn of the Australian dollar to go up against the British pound. Would we see four bad results followed by one better one here too? We opened on 1.9026 and fell to 1.8851 on Monday night, so it looked as though this would be the case. We did buck the trend slightly by getting a better result on Wednesday, but apart from that it was much the same. This time we ended on 1.8599 on Friday evening.
Notable events in the world of currency
Another fall against the Canadian dollar
At least this one wasn’t quite as bad though, as the pound went from 1.8037 to 1.7903 over the week.
The same again with regard to the Swiss franc
Here too we had disappointing news, as the pound fell from 1.5412 to 1.5399.
A slightly better result against the Icelandic krona
Here at least we did slightly better. This time the pound started on 197.548 and eventually ended the week on 197.763.
With plenty of sobering news to think about here, it was certainly not the start to 2015 we were looking for. Indeed there were some significant losses in some areas. So how will future weeks improve for the pound – if indeed they do?
Whatever happens we shall be here next week to see whether the pound is able to pick up on some of those losses and retrieve a better position. We’ll see you then.