A Mirror Opposite to Last Week for the British Pound

Posted by Allison on 4 February 2019, 12:45

Last week was one of the strongest weeks we have had in a while for the British pound. It seems challenging to suggest this week could continue in the same way. Would that be the case… or not?

An overview of the currency markets for January 28th – February 1st, 2019

The British pound started this week on 1.3186 and immediately dropped in value over two days against the US dollar, taking it to 1.3064 by Tuesday night. While it increased to 1.3113 the following day, it then dipped once more over the final two days of trading. So, from a good start we managed to lose ground quite quickly, taking the pound to a closing rate of 1.3083 and losing almost a cent in the process. Not the best way to go from one month to the next, but it could have been worse than that.

With that knowledge safely in our minds, it was not a stretch to assume a similar picture might play out against the euro too. Indeed, that was the case for the British pound as January finally gave way to February. Opening the week on 1.1564, the pound lost ground over the first three days of the week, taking it to 1.1422 by Wednesday evening. While there was a slight improvement to 1.1450 the following day, it did not recoup any other losses. It also did not do well on Friday, taking the pound into February on 1.1419 against the single currency.

Over in Hong Kong, the pound had an opening exchange rate of 10.345 last week against the Hong Kong dollar. We should expect an initial drop here and that is what happened. A steady fall over the first two days took the pound to 10.251. Two better days then followed, seeing the British pound perform better to reach 10.286 by Thursday night. With a final rate of 10.265 on Friday though, we could see the pound was having a struggle to perform as well during this week as it had last time.

So, could we expect a steady fall against the New Zealand dollar as well? Opening here on 1.9305, the pound ended up losing ground from one day to the next. We couldn’t stall that backward slump until Thursday night, by which time the pound had dropped to 1.8949. While it managed to eke out a slight improvement to 1.8980 by Friday, this still gave us a significant loss over the final four days of January into February.

We might expect a similar pattern to play itself out against the Australian dollar too. We won’t keep you in suspense for this one – the answer, sadly, is yes. Starting the week on 1.8374, we had the same four days of poor results, this time taking us to 1.8014. A slight improvement to 1.8042 finished the week here.

 

Notable events in the world of currency

Losing ground against the Canadian dollar too

The British pound was not having the best week. It dropped from 1.7433 to 1.7142 against the Canadian currency.

 

More of the same versus the Swiss franc

The pound started well on 1.3096 after last week, but soon lost some of that progress, dropping to 1.3025 by the week’s end. At least here, the damage was minimal.

 

Another slight fall against the Icelandic krona

The pound began on 157.663 and experienced an up and down ride throughout the week before landing on 156.682 by Friday night.

 

So, this was a more troubling week for the British pound. Perhaps that was to be expected after last week’s highs. Maybe this week was more about levelling off the progress rather than experiencing losses as such. However, we will learn more when we get the first full week of results for February. It may be a short month, but we feel it could be a notable one that delivers lots of interesting results for the British pound. It will be interesting to see if we’ve got that right.

 

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