Posted by Allison on 7 January 2019, 17:34
It hardly seems like five minutes ago we were writing our last currency report to cover Christmas week. Yet here we are again, ready to reveal what happened over a shortened festive period in 2018. As we approach the end of another year, would the British pound manage to finish in fine style or in poor form?
The week began with the British pound worth 1.2646 against the US dollar. By the time Christmas Eve was over, it had managed to sneak ahead to 1.2696. Two days’ break followed, after which the pound finished on the 27th December on 1.2645 – a loss after the good work put in on Monday. Fortunately, it did manage to regroup and finish the week in better form. This meant the closing exchange rate for Christmas week was 1.2698 – yes, it was higher than we had expected and was the highest rate for the week.
We never know where we will stand from one moment to the next against the euro, given the scenario we are facing at present. The week began with the pound worth 1.1118 against the euro, before increasing that position to 1.1136 before the Christmas break. However, it dropped to 1.1060 on Thursday. While it managed to increase its position to 1.1095 on the last day of the week, it was not enough to recover the losses it had already experienced.
Moving over to Hong Kong now, the British pound began trading on 9.9051 after a good week last week. It did well here too on the one available day before the festive break, soaring to 9.9466 in those few hours. Unfortunately, the pound did lose some ground on the first day returning to the currency markets, dropping to 9.9008 in the process. That piece of bad news was swiftly followed by good news, as the pound put in some good work on the last day, rising to 9.9437 as it did so.
The shortened week also turned out promisingly all told in New Zealand. The pound started off on 1.8803 against the New Zealand dollar, before rising to finish on 1.8860. After the two-day break, it resumed where it had left off, increasing marginally to close Thursday night on 1.8877. Add in another positive performance on Friday and it finished in style on 1.8928.
The question now was whether that encouraging performance was to be repeated in Australia. We opened trading on 1.7962 here, and once again did well before breaking for Christmas by rising to 1.8012. While we dropped back slightly to 1.7984 on the first day back, we rose again to finish the week in better style, closing out with an exchange rate of 1.8033 – yet again another good improvement for the shorter week.
Here the pound did well to go from 1.7195 to reach 1.7311 over a three-day week.
We cannot hope to do well everywhere, and the pound did not have what it took to achieve a good result against the Swiss franc this week. Instead it dipped from 1.2572 to 1.2499 all told.
After an early rise from 148.142 to 148.375, the pound finished the week lower overall on 147.820 against the Icelandic currency.
This is perhaps one of the hardest weeks of the year to predict which way the currency markets will go. If we manage to perform well over the course of the week, we can be encouraged with some promising results. We have seen how a three-day week can go in our favour here, although we can also see how a drop can occur very easily.
Next week we will go from 2018 into 2019, but will we do so in style or in uncertainty? We will have all the results that will reveal the answers – whether they are good or bad.