A Mixed Bag for the British Pound on the Currency Markets This Week

Posted by Allison on 12 September 2016, 15:40

Welcome back to our currency report, which once again looks at how the British pound is doing. Let’s waste no time at all and dive right in.

An overview of the currency markets for September 5th – September 9th 2016

The British pound was worth 1.3283 against the US dollar when the week got underway. The first few days were actually very good for the pound, even though the improvements each day were only small. By Wednesday, it had reached a new level of 1.3382. However, that would be the peak the currency would reach this week. By Thursday evening, we were looking at a slightly lower exchange rate of 1.3358 – not a massive drop, and still better than the opening rate had been on Monday morning. And once again we could say the same thing about Friday’s rate. This took the pound down to 1.3325 to close out the week – but it still represented an improvement overall.

Let’s move on to the pound’s standing against the euro now, to see if a similar pattern would be seen there. We began trading on 1.1868 and had two good days to start with. This meant we ended up on a rate of 1.1971 by Tuesday night – not a bad outcome for just two days’ worth of trading. However, by Wednesday night we had dropped back to 1.1909, leaving us to ponder what the remaining two days had in store. We dropped back further to 1.1825 on Thursday before rising to 1.1826 on Friday, meaning we had lost some ground overall.

Over in Hong Kong, we would face the same pattern we had against the US currency. The first three days were encouraging, sending the pound from an opening rate of 10.303 all the way up to 10.378 by Wednesday night. We then had the same two drops in store we had against the American dollar. Here, we ended up dropping back to 10.335, so we had still done well over the course of the week as a whole.

You never know what you will be faced with when looking at the New Zealand dollar. The pound began trading on 1.8192 before rising to 1.8234 on day one. However, we then ended up going through three poor days through the middle of the week. By Thursday night, we finished up on 1.7925 – some way down on the position we had started from. Could we manage to do better on the final day? We did bounce back to 1.8092 but this was still lower than we’d started out from.

Finally, let’s see if we had anything to fight back with against the Australian dollar. We began trading here on 1.7576 but the bulk of the week certainly didn’t go our way. In fact, we had four days of bad results that took us down to 1.7303 by Thursday evening. We did recover significantly to 1.7545 on Friday night, but we’d still dropped back a bit over the course of the week as a whole.

Notable events in the world of currency

A drop against the Canadian currency

The Canadian dollar proved too strong for the British pound this week, pushing it back from 1.7378 to 1.7266 as a result.

Another drop against the Swiss franc

It wasn’t just the euro the pound had trouble with last week. The currency also fell against the Swiss franc, going from 1.3006 on Monday morning to 1.2972 on Friday night.

More of the same against the Icelandic krona as well

Here too we saw how the British pound didn’t quite have enough in the locker to stand up against other currencies last week. It fell from 153.397 to 152.831 here.

So we can see that last week was a challenge for the British currency. Could we turn things around this week and hope to get some better results as a consequence? We will be watching to see if that proves to be the case.