Posted by Allison on 3 April 2017, 09:13
Welcome back to another currency report, and a chance to see how the British pound did on the currency markets from 6th March through until 10th. Would it bring good or bad news for the currency?
So, the British pound started this week on 1.2234 against the US dollar. It managed a good day to begin with, climbing to 1.2273 by Monday evening. However, the following two days were not as promising, as the pound ended up slipping back to 1.2167 by Wednesday night. It did manage to edge ahead to 1.2176 the following day, but with a drop to 1.2155 by Friday night, this was clearly not a good week for the British currency – not against the US dollar, anyway.
Could it do better against the euro? Well, we began on 1.1580 here, before rising to 1.1587 on day one. This was the good start we had experienced against the dollar, before things went south. The same happened here too – in fact, we dipped to 1.1526 by Wednesday night, before rising to 1.1540 on Thursday. But once again, the drop we had seen against the dollar on Friday happened here as well, taking the pound back to 1.1461 and meaning we’d had a losing week overall.
The pound had the same pattern showing up against the Hong Kong dollar as well. It began on 9.4992 on Monday, rising to 9.5289 that day before falling back to 9.4500 by Wednesday. And you would be correct if you assumed we were in for a rise on Thursday in time for a fall to close the week, because that is exactly what happened here. This meant Friday’s closing rate was lower once again compared to the beginning of the week, with the pound stalling on 9.4403 on Friday.
Could we assume the same would happen against the New Zealand dollar? We could, but we would be wrong in doing so. Things very often take a different course here, and they did this week, too. We began on 1.7382 and then had four good days in a row. This might seem unbelievable, but the figures tell the truth, revealing a rise to 1.7630 by Thursday evening. This was impressive, and although the pound dipped to close out the week on 1.7590, this was still far higher than we had expected it to be, especially given the progress (or lack of it) seen elsewhere.
If we expected the pattern against the Australian dollar to follow that seen against the New Zealand dollar, we would be wrong. We began on 1.6161 here, before experiencing two poor days that took us down to 1.6053 this week. We then had two good days that brought us back up to 1.6207, before finally dipping to 1.6154 by Friday night.
The pound did well here, rising from 1.6398 to 1.6414 over the past week. Would it continue in the same manner next week, too?
The good news did not continue elsewhere, as the pound fell from 1.2361 to 1.2312 against the Swiss currency.
Here, we managed to go from 130.607 to 131.426 last week, which was better than we had seen elsewhere.
So, this was a mixed bag of results as far as the pound was concerned. We had seen struggles against many major currencies, and yet elsewhere, things were rather better. This meant it was difficult to gauge how things might continue next week, when the pound continues its attempt to do better on the currency markets.
With Brexit about to be formally triggered, perhaps we should expect some further dips to take place, rather than seeing rises on the markets. Uncertainty is never good for currencies, but you simply never know what will happen until the moment comes.