A Hard Time for the Pound This Week

Posted by Allison on 15 January 2018, 21:40

The first full week of trading for the New Year is with us. Would the British pound go into the week with confidence, or was there another story brewing?

An overview of the currency markets for January 8th – January 12th, 2018

So, would we begin the week with a good outcome against the US dollar? The British pound began on 1.3551, but the first two days did not bode well for the week overall. At least the drops were minor, taking us to 1.3517 by Tuesday evening. There was some good news the day after, with a boost to 1.3524, but Thursday brought more of the same bad news, dropping us back to 1.3490. Fortunately, the best was kept until last. Surprisingly, the pound managed to eke out a win by reaching 1.3639 on Friday evening.

We couldn’t have predicted the week’s ups and downs against the dollar. So, could we predict what would happen against the euro? The opening rate here was 1.1250 but the first two days went rather better than they had elsewhere. This took the pound to 1.1328 by Tuesday night, before it dropped back over the next two days. That meant we were back to 1.1226 on Thursday – lower than the starting rate. But again, we managed a better day on Friday. Unfortunately, it wasn’t good enough to garner a success over the whole week. Instead, we finished on 1.1238. 

We were wondering whether the pattern against the Hong Kong dollar would replicate that seen against the US dollar. And indeed it did. We began on 10.596 before dropping over two days to reach 10.572 on Tuesday. We then perked up to 10.579 the day after, and dropped again on Thursday, this time to 10.553. According to what occurred against the US dollar, we should expect a larger rise now – and that is exactly what we got. We managed to reach 10.671 by Friday’s close.

You never know how things are going to proceed against the New Zealand dollar, and this week was no exception. It certainly didn’t follow the pattern we had seen against other dollar currencies. We began by trading on 1.8942, but we then entered a four-day period where the only direction the pound went in was down. We stalled on 1.8695 on Thursday night, before managing to wipe out some – but not all – of our losses by rising to 1.8796 on Friday.

Would we follow a similar path against the Australian dollar? This often happens, but it wouldn’t quite be the same this time. Opening on 1.7282, we rose slightly to 1.7292 on day one, before progressing into a three-day fall. This meant Thursday night gave us a rate of 1.7155. However, we did save the best for last here, with a rise to 1.7325 and a successful outcome for the week.

 

Notable events in the world of currency

A good result against the Canadian dollar

It would not be a huge rise, but a rise from 1.6952 to 1.7075 was good enough in a week where results were a mixed batch.

 

A marginal improvement against the Swiss franc

The progress was indeed mild here, but the pound still went from 1.3227 this week to 1.3246.

 

A slight rise against the Icelandic krona too

It wasn’t merely the major currencies the pound did well against in some quarters. It managed a rise from 140.740 to 140.812 during the first complete week of 2018.

 

So, we have a mix of results this week. This happens on many weeks, of course, but somehow this week seemed more important. We want to get off to a good start for the year, but the British pound did not perhaps achieve all we wanted it to. We can but hope we achieve better next week. The picture against the US dollar is rather good, so maybe we can replicate the gradual rise we are seeing against that currency for others, too. We shall report on the outcome… whatever happens and whichever way things go.

 

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