Posted by Allison on 13 August 2018, 19:09
We appear to be in uncertain times at present – at least where the British pound is concerned. Our review of the currency markets for last week proves this scenario. But are there any clues to how things might pan out from here?
It’s always nice to get a good start to the week on the currency markets. However, it doesn’t look likely that will happen for the British pound against the US dollar this week. We opened on 1.3012 here, before dropping to 1.2928 by Monday night. Even a marginal rise to 1.2965 the following day didn’t leave us feeling hopeful of more promising results to come. The up and down nature of the exchanges between these two currencies became clear through the week. The overall pattern was down, however – leaving the British pound stalled on 1.2775 by Friday evening.
The pattern would prove to be very different against the euro. This would be a week of two halves, with three poor days to start things off. The pound opened trading on 1.1229 here, before steadily falling to reach just 1.1100 by Wednesday night. We did manage to carve out some improvements over the final two days of the week. However, this only enabled us to claw back some ground and finish on 1.1151 by Friday night.
Moving on now, we soon discovered the pound would follow the same pattern against the Hong Kong dollar that it had against the US dollar. We began on 10.213 before falling to 10.148 to put us on the slide right at the start of the week. The up and down pattern that followed meant we ended up almost convinced we would see a fall in the exchange rate over the whole week. We were unfortunately correct in that belief, as the pound had slipped to 10.028 by the time Friday’s trading had ended.
So far, the pound had not done well. However, we can never be certain the pattern will be the same against the likes of the New Zealand and Australian dollars. Let’s check out the pound’s performance against the Kiwi dollar first. Here, we began trading on 1.9281 before launching into a three-day slide on the markets. That was bad news – and it meant the pound had dipped all the way to 1.9095 by Wednesday night. However, we also know the pound can experience marked improvements in a short time against this currency. It did, too – rising from that 1.9095 rate to 1.9369 on Thursday. Even though there was a small drop to close the week, the closing rate of 1.9364 was better than the pound had started out with.
We had a similar picture to contend with against the Australian dollar as well. In this case, we began trading on 1.7618 before falling to 1.7369 by Wednesday night. Once again, the turnaround began on Thursday. We had just two days to recoup those losses, and while we did not manage to do that, we did manage to close the gap and finish on 1.7479.
We noticed a steady fall this week against the Canadian currency. From a starting rate of 1.6939, the pound suffered losses four days out of five. This sent it tumbling to 1.6729.
The week saw the pound fall every day against the Swiss currency. Opening on 1.2945, the pound soon dipped to close on 1.2702 on Friday night.
Sometimes, you need to look further afield to find better results. This time, we managed to edge ahead from 138.798 to reach 138.946 against the Icelandic currency. A small improvement, but better than nothing.
It is clear this was not the best of weeks. But will there be more of the same next time, or will we have good news to share? Don’t miss our next report to learn more.