Posted by Allison on 6 November 2017, 16:05
Welcome back to another currency report. This week would prove to be a cautionary tale for the British pound. Let’s find out why here.
The British pound opened the week on 1.3093 against the US dollar, and had an excellent start too, rising to 1.3198. But we were not expecting the next two days to be equally as good. By Wednesday evening, the British pound had climbed to an impressive 1.3288, giving it a protective cushion against any falls from that moment on. We needed it too, because the final two days of the week saw falls for the pound. By Friday evening, it had dropped to 1.3109, but this was still marginally better than the opener had been on Monday morning.
Next up is the position of the pound versus the euro. Here we began on 1.1282 and experienced another very good day to open on. This led us to a rate of 1.1366 by Monday night. And yes, we had two more good days to follow, too. This took us to 1.1443 by Wednesday evening. But would we see two days of falls to close the week, as we had against the dollar? We would, because by Friday the British pound had dropped to close out the week on 1.1245. And in this case, it was lower than the opener, which was disappointing news after the good start we’d had.
Elsewhere, the pound started trading on 10.217 against the Hong Kong dollar this week. By now, we were half-expecting that pattern to continue. We did indeed see three good days to begin the week, and that meant the pound climbed to 10.367 by Wednesday evening. We then had the same two disappointing days of trading to close the week though. This led to a finishing rate of 10.228 on Friday – just ahead of where we’d begun five days earlier.
Our fourth stop takes us to New Zealand, where the pound started on 1.9152 this time. This is quite often somewhere that the usual trend takes a detour, and it did so here as well. Instead of the three good days to begin, we had just two. By Tuesday night, the British pound had reached 1.9356. But was this enough to secure a good week all told? Far from it, as it turned out. Three consecutive falls took the pound far lower to 1.8889 by Friday evening – a big disappointment there.
So, would we see something similar against the Australian dollar as well, or was this where the pattern would be broken? We opened the week on 1.7144 and managed three good days here to start with. This took us to 1.7321 by Wednesday, but by now we were used to starting well and ending on disappointment. And once again we were proven correct, as the pound dipped to close out a disappointing week on 1.7075.
The pound began trading on 1.6879 this week, and although the week started well as it had elsewhere, it soon dipped to close on 1.6677.
The by-now-familiar pattern against currencies was seen again as the pound began on 1.3123 against the Swiss franc, before dropping to 1.3084.
You had to look hard to find good results last week, and this one saw an up-and-down pattern against the krona. It did, however, result in the pound enjoying an overall rise from 139.158 to 139.630.
So, this was indeed a tough week, especially after a good beginning in many areas. It shows how important it is for the whole picture to become clear before we assess how a currency pairing has performed in any one week. Perhaps next week will bring better news… but only time will reveal the answer to that.