Posted by Allison on 2 February 2010, 14:34
So here we are at the end of January already, and one twelfth of the New Year has gone. But will the British pound be able to end on a good note, or is there some bad news in the offing that will kick off February?
Last time we had a mixed week, with three good results and two not so good ones. So at least on balance things were better than they could have been and we achieved more good results than bad ones. The pound did drop back against the US dollar though, with a loss of nearly two cents over the week as a whole.
Quite often when we see such a loss we expect the British pound to do just as badly against the Euro. But last time this was not the case. Instead we saw a slight increase of just over half a Euro cent against the single European currency, so that at least was something to be proud of.
But it was back to a poor result against the Hong Kong dollar, when the pound managed to drop a total of 0.124 over the week as a whole. So it seemed we were not really following a pattern here – it all depended on what we managed to achieve against each individual currency.
We usually see similar results between the New Zealand and Australian dollars as well, and indeed this was the case last time with increases for the pound against both currencies. The pound saw a jump up of 0.057 against the Kiwi dollar, and while the increase against the Aussie dollar was less at just over two cents, it was still a good result for the week as a whole.
So with that in mind let’s move on now to see how the British pound did during the last few trading days of January 2010. Will the figures on the currency converter be any more promising this time around? Let’s find out.
So here we go with our usual starting point, which is with the US dollar. How did the pound do after the poor showing it put in last time?
The starting exchange rate here was 1.6130, so we were at least looking to stay above the $1.60 rate if at all possible.
Monday saw no change in the exchange rate at all, with the pound settling on 1.6130. This at least meant we weren’t starting the week on a negative note, but equally we hadn’t made any headway either.
Tuesday saw a slight difference in the exchange rates but it didn’t really add up to very much. By the time the markets closed that night the pound was on a rate of 1.6128, having dropped 0.0002 during the course of the day. Did this mean we would have more decreases during the week, or was there a different story that was yet to be told?
Wednesday, the midweek point, can often provide either hope or hopelessness to take through to the remaining couple of days left in the week as a whole. In the case of the pound versus the US dollar last week though, we ended up with a good result. The exchange rate went up to a healthy 1.6226 by the day’s end. Did this mean there was even better to come as the week played out?
As it turned out Thursday did indeed have more good news in store. The pound managed to keep up the pressure and continue what was already something of a good week all in all. By the time the markets closed and everyone headed home for the day the British pound had edged up a little further and gained a rate of 1.6247 by the day’s end. This wasn’t as pronounced an increase as we had seen the day before, but it was enough to make us feel confident this could well be a good week overall.
But there was still one day of trading to go and as we know from previous experience a lot can happen in a single day. We had seen a good week’s worth of results so far, but could we carry that performance on for just one more day, or would the US dollar finally start to fight back?
As it turned out the US dollar would indeed do that, and the pound was in for something of a shock. By the time the weekend was finally upon us and the markets had closed for the week, the pound was standing at a lower rate of 1.6116.
So after all that hard work the final rate turned out to be lower than the one we had started with. We ended up on a rate that was 0.0014 lower, so at least we had managed to limit the losses somewhat. Although after the good start we had made it was a disappointment to end up on a bad note.
But let’s move on to the Euro now and see how the pound did against that currency. When we last left it we were on an exchange rate of 1.1411, which is somewhat healthier than we had seen some months ago at least. Could we now continue to push it in a better direction?
The answer wasn’t looking too positive if Monday’s result was anything to go by. By the end of the day the pound had dropped back to 1.1398. Once again it wasn’t a huge drop but we would have preferred a small increase.
Luckily there was better news in store on Tuesday as the pound immediately bounced back and finished the day on a rate of 1.1450 against the Euro. This looked much healthier and we were wondering whether it was going to bode well for the remaining three days of the week as well.
The midweek point was even better for us as the pound carried on climbing to close on 1.1530. This was one of the best rates we had seen in a long time, giving us hope that this would not only be a good week, but that we would see even better rates to come as well.
The following day saw another battering for the Euro as the pound kept on going to finish on 1.1606. We had done very well so far, but we have already seen that a good four day run against the US dollar could end in disaster, so it was still too early to be overly optimistic.
And indeed we did see a similar dip against the Euro as well, although thankfully not quite as pronounced as we had seen against the US dollar. By the time the week closed as a whole the pound had settled on 1.1540. This meant we had still come out on top for the week, although not by as much as we wanted to. The total increase was still a respectable 0.0129 however, so there was still cause to celebrate here.
But what about our exchange rate against the Hong Kong dollar; could we do well here too and get another good result?
We lost 0.124 last time which left us on 12.535 to start with this time around. And we didn’t get the best start because by the end of Monday evening we were sitting slightly lower against the Hong Kong dollar at 12.530.
There was better news on Tuesday though as the pound fought back to claim 12.537 by the end of the day. It seemed as if the pound was off to a slow start this week, but it was making up for it by the time the second day was over.
And there was more of the same on Wednesday as the pound really took charge of the situation and climbed up to an impressive 12.617. Could it continue and make a real difference for the week as a whole? If it could then we would be having a good week all in all.
We managed another increase on Thursday although perhaps predictably it wasn’t anywhere near as good as we had managed the day before. This time we settled on 12.622 by the day’s end.
And this left us with just one more day for the week as a whole. And just as we have already seen elsewhere this week, we ended up on a slightly lower rate on Friday. After all the good work we had managed so far, Friday was one day too far to do it again. So we finished up on 12.517 against the Hong Kong dollar, and that meant we were 0.018 down in the end.
So with that in mind let’s move on to our fourth stop for the week and take a look at what happened in New Zealand. This presented us with our best result last time, which was an increase of over five and a half cents all in all. This left us on 2.2699, so could we manage another successful week here now?
Once again it was a slow start for the pound as we slipped back to 2.2602 by the end of trading on Monday. But we more than made up for it the following day as we leapt back up to 2.2823. This was a great start to the week but the question was whether we could keep it up or not.
The answer was definitely yes as far as Wednesday was concerned, as the pound managed to take on the New Zealand dollar and push the rate up even further to 2.2906. Could it get any better than this or would this be the best we would see for the week as a whole?
There was a dip in store the following day as the pound fell to 2.2858, but that probably wasn’t a huge surprise as we had done so well thus far. And even though Friday gave us another loss – leaving us on 2.2815 at the week’s end – we had done enough to give us an outstanding result once more. All in all we managed to add on a further 0.0116 over the course of the week.
So now we are left with our final stop which as always is Australia. We did well here too last time, leaping up by over two cents over the previous week. Could we do something similar here this time as well?
Our starting rate was 1.7869, so the closing rate of 1.7821 on Monday wasn’t too encouraging. But as we have already seen elsewhere, the pound didn’t get off to the fastest start this week. And again as we have seen already, Tuesday turned out to be a different story. By the time the day was over the pound had leaped up to 1.7969.
So was this the turning point we would remember for the rest of the week? It certainly seemed to be, because Wednesday’s closing rate brought something even better - 1.8052. Breaking through the $1.80 barrier was as much symbolic as it was practical, so it would be good if we could keep that rate up for the rest of the week.
There was a slight drop on Thursday as we lost a bit of ground and finished up on 1.8032, but it wasn’t enough to spoil the whole week. And in fact we managed to add on a bit more on Friday and finish up on 1.8047 by the end of the day. That meant we had had a successful week all in all, adding on a total of 0.0178.
So the pound had a lot to be proud of last week – as did we.
The pound was clearly on a roll last week, as it started on 1.6787 on Monday night and broke through to 1.7090 on Thursday. It fell back to 1.6919 on Friday but it wasn’t enough to spoil a good week.
It wasn’t a good week for Switzerland as the US dollar also did well against their currency. Monday night’s rate of 1.0407 became 1.0518 by Thursday night, before the Swiss franc beat it back to 1.0498 on Friday night.
The US dollar had a good week all in all as it managed to go from 1.0597 on Monday night to 1.0685 on Friday night against the Canadian dollar.
The following news story here indicates how well the pound has been performing of late. We have seen these results indicated this week, so it will be interesting to see if they continue in the same vein.
So that’s all from us for another week. We will be back next week to see how the pound does against these five major currencies next time. We’ll see you then.