Posted by Allison on 2 April 2019, 14:27
Given the drama in Parliament this week, it was perhaps to be expected that the British pound would have a tough time on the currency markets. Would it be as tough as we suspected?
The British pound started the week against the US dollar on 1.3210, and it did not get the best start, dropping to 1.3194 over that day. There was good news the following day as it rose to 1.3207, but beyond that point it did not go well for the pound. Instead of building on that improvement, it ended up dropping considerably, with Friday night putting a stop to the falls when the pound finished on 1.3044. Not the start we had hoped for. Would it indicate the direction the week would go in, we wondered?
The rises and falls against the euro were commonplace, given the situation regarding exiting the EU. This week on the currency markets indicated how true this was. The pound opened on 1.1695 before dipping to 1.1661 by the end of that first day. Beyond that, it achieved the high point on Tuesday, as it had against the US dollar, reaching 1.1718 as it did so. That was the turning point though – and not a good one either. Instead, the pound dipped to 1.1613 by Friday evening, marking yet another fall here, although not perhaps as bad as it could have been.
A similar picture was about to play itself out against the Hong Kong dollar as well. Again, it was soon proven that Tuesday was the best part of the week. The pound opened on 10.367 before dipping to close out day one on 10.353. The best closing rate was the following day on 10.366, before three days of steady dips came into view. This meant the pound finished the week on 10.239 – notably lower than it had been to start with.
A slightly different picture was seen against the New Zealand dollar. The British pound started on 1.9216, and it didn’t have a great day to start with, falling to 1.9092. However, the next two days were far better. By Wednesday night, the closing rate for the pound was 1.9359. Unfortunately, the pound had peaked too soon. By the time Friday evening came around, the pound had fallen to 1.9176, giving us yet another loss for the week.
Finally, the pound went up against the Australian dollar. Would the pattern follow the one seen against the Kiwi dollar here, as it had in so many other weeks before it? Opening on 1.8666, the pound dipped to 1.8552 on day one before reaching the highest point of the week on 1.8565. That was still lower than the opening rate, of course, and by Friday the pound had fallen further, stalling on 1.8407 as a result.
We should not have expected anything else. The pound started on 1.7736 and fell to close the week on 1.7423.
Here too we had a disappointing week. The pound opened the week on 1.3129 before dropping to 1.2976 by Friday night, even though it had achieved better results midweek.
Here, the pound did manage to get the better of the competing currency. The pound started on 157.932 on Monday morning, before improving to 160.115 by the end of the week.
There were a few reasonable results in the mix this week, but you really needed to look to find them. It seemed as if the midweek point produced more positive results than the later stages, but that was perhaps to be expected. Will the ongoing drama in Parliament produce yet more uncertainty on the currency markets? It would seem so, but we shall be watching to see what happens next and report back when we have further results.