Posted by Allison on 19 June 2012, 05:38
It has been another busy week in the currency markets, where the British pound has been fighting to improve its standing against a wide range of other major currencies. How well did it do?
The opening rate for the British pound against the US dollar this week was 1.5431. There was good news straight away because by the end of Monday the pound had improved to 1.5530. There was another jump up on the following day as the pound finished on a better rate of 1.5540. The one blip came on Thursday as the pound fell back to 1.5510 but it did improve a little to close the week on 1.5514.
Next up is the Euro, and the pound started the week on 1.2377 here. It had climbed a little on day one and reached 1.2380 by the close of play. The following day was better as the currency hit a high of 1.2440, although it fell back to 1.2402 the day after that. There was no telling whether the pound would have a good week overall until Friday, and unfortunately the outcome wasn’t good. The pound ended up down overall on 1.2316.
Let’s see how things went against the Hong Kong dollar now. The opening rate was 11.971 and day one turned out to be a good one as the rate closed on 12.049. It then followed a similar pattern to the one it had followed against the other two currencies – doing well the first half of the week and then dropping for the remainder. Here it fell to 12.033 on Thursday and then picked up slightly on Friday to finish on 12.038.
Now we can look at the position against the New Zealand dollar, where the pound opened the week on 2.0191. If we were expecting a similar pattern to the one we had seen above, we were in for a shock. The only way this week was down, as the pound dropped over the first two days and ended up going below the two dollar mark on Wednesday. It had a further notable drop to make over the last two days of the week as well, and in the end it hit a low of 1.9763 on Friday evening.
Finally let’s see whether the Australian dollar would mirror the results we had seen against the New Zealand dollar, or whether there was a different result in store. The pound opened proceedings on 1.5675, but there would be a far choppier result against the Aussie currency than there was against the Kiwi dollar. The pound dropped on day one, only to regain its opening position the following day. After some more ups and downs the closing rate on Friday night was 1.5474.
The pound slipped from 1.5958 to 1.5889 over the course of the week against the Canadian dollar.
This was clearly not a good week for the pound as it fell from 1.4867 to 1.4792 against the Swiss franc as well.
Things got worse still here as the pound lost its rate of 199.700 and exchanged it for a much lower 195.987 on Friday evening.
The idea of the pound starting the week in a reasonable position was borne out by this report from Reuters. It also indicated that things could get worse, which indeed they did towards the end of the week. It remains to be seen whether things will improve over the coming week, and whether the outcome of the Greek election will have any impact on the British pound.
We will be back next week to see whether the pound has managed to recover any of those losses or whether it has lost yet more ground in the fight to gain some good exchange rates.