Unstable Times Still for the British Pound
Posted by Allison on 25 July 2016, 14:17
We’ve been assessing the progress – or lack thereof – of the British pound over the past week. Let’s see what has come to light during that time.
An overview of the currency markets for July 18th – July 22nd 2016
The British pound began this most recent week on 1.3362 against the US dollar. The first two days did not go well at all, with the pound dropping over that time frame to reach a low of 1.3144 on Tuesday evening. The next two days went rather better, but the rises were small, enabling the pound to reach only 1.3176 by Thursday night. We then had another drop on Friday, which meant the closing rate was just 1.3095.
When it came to the euro, it was only reasonable to expect a similar pattern here. Indeed, that is what we got as the week began and eventually came to an end. The pound started trading on 1.2008 before dropping back over the course of two days to finish on 1.1911 on Tuesday. There was definitely a similar pattern rolling out here as we’d seen above. Two rises occurred over the next two days as well, giving the pound a chance to improve to 1.1962 on Thursday night. But we then experienced the biggest drop of the week at the last minute, to return the pound to a low of 1.1889 against the euro.
We opened on 10.361 against the Hong Kong dollar this week, before having two bad days. There was definitely a pattern developing here. We had a rate of 10.194 on Tuesday evening, but that was improved upon over the two forthcoming days until it reached 10.219 on Thursday evening. Friday saw a closing rate somewhat lower still though, as the pound dropped further to 10.155.
So where would the pattern take us in New Zealand? Well, we often see something a little different here, and it was certainly the case this time as well. We had a rate of 1.8653 to start with, and this soon shot up over the course of four days. By the time Thursday evening rolled around, we were looking at 1.8887 as a much better rate. We did drop back to 1.8723 by Friday night, but at least we were a little better off.
Finally, we have the exchange rate against the Australian dollar to look at. This was 1.7457 to start with, and we had three good days here to begin with. This took the pound to 1.7597 by Wednesday night. After two days of drops, though, we had a finishing rate of 1.7497 by Friday night.
Notable events in the world of currency
Another drop, but a smaller one, against the Canadian dollar
At least the fall was less here, as the pound went from 1.7192 to 1.7163 this week. We were expecting a bigger dip.
A similar picture was seen against the Swiss franc too
The British pound was still troubled here as well. It started trading on 1.3087 this week before dropping to 1.2911 by Friday night.
More of the same, this time against the Icelandic krona
Even some lesser-known currencies were getting better results against the British pound. This was seen as the krona pushed the pound down from 162.251 to 159.835 this week.
So as we can see, things are still proving to be tough for the British currency. However, there is some uncertainty as to whether this will continue for the long term, or whether the picture could potentially improve within a shorter period of time. We are in completely new territory here, which means literally anything could happen. We might see the currency becoming more stable once it reaches a certain level; on the other hand, it could continue to drop for the foreseeable future.
One thing is certain however, and that’s that we will be here with all the latest results from the currency markets. The one place you need to be to see how the pound is doing is here.