Posted by Allison on 2 May 2017, 16:52
Welcome back to yet another currency report, where it is time to see if the British pound could continue to build on the good results it had achieved last time around.
After the surprise General Election announcement from last week, and the subsequent bounce for the British pound, the question now was how long that bounce would last for. We had some good news to begin with, as the pound climbed from the opening rate of 1.2778 to 1.2787 on day one. But where would it go from there, we wondered? The answer was that it increased in value every day last week – something we would probably not have bet on, if guessing in advance. But by Friday, it had reached 1.2939 – significantly better than the starting rate had been.
So, could this excellent news be replicated as the pound went up against the euro? We began trading on 1.1944 here, but the first two days did not go in our favour. Instead, the pound fell to 1.1774 by Tuesday night – perhaps because of the combative news that kept being reported on negotiations for Brexit. We did then have two good days, though, which meant the pound was able to climb to 1.1845 by Thursday. It still had to try and regain its opening rate though, but with a drop to 1.1838 on Friday, this would not happen this week, at least.
Our third stop on our exploratory journey of the currency markets is with the Hong Kong dollar, where the pound started off on 9.9366 last week. As it turned out, the week progressed well here, in much the same manner it had against the US dollar. With improvements being made every day bar none, the pound finished the week encouragingly on 10.062 – a rate we have not seen in a long time.
So, where would we be by the end of the week against the New Zealand dollar? Would the positive pattern against dollar currencies hold up here, too? We started to trade on 1.8247 but we experienced a dip on day one, taking the pound to 1.8203 by the day’s end. From then on, the pound assumed its normal business against dollar currencies this week though, which meant it was able to reach 1.8819 by Friday night – a huge leap of nearly six cents over the week.
Would this give an indication to how the British pound would perform against the Australian dollar too? It seemed it would, because the pound once again dipped on Monday – this time from 1.6983 to 1.6892. And then we had the same four excellent days we had seen against the Kiwi dollar, which took the pound up to 1.7317 to close the week in excellent form.
Here, we managed to take the opening rate of 1.7215 and push ahead to a more encouraging 1.7655 by the week’s end.
The pound was having another strong week this week, as evidenced by the good performance against the Swiss franc, too. It opened on 1.2756 and finished on 1.2821 this week.
We had to do poorly somewhere, and it turned out the krona was better than the pound last week, perhaps surprisingly. The British currency opened on 139.899 before slipping to 137.285 against the Icelandic currency.
So, this was a memorable week once again – and this time for all the right reasons. There was the odd result that was not as good as we would have liked, but on the whole, things looked very good and we were well-placed to try and make another good week of it next week, too. Will we manage to do that? We will have all the answers for you one week from now, so don’t miss it.