Posted by Allison on 11 April 2017, 09:24
Welcome to our latest look at the currency markets, which has revealed some challenges for the pound this week. But how challenging a week would it be overall?
The British pound started well this week, against the US dollar, at least. It moved up from its opening exchange rate of 1.2496 to settle on 1.2504 by the day’s end on Monday. However, it suffered a dip to 1.2439 on Tuesday, taking it back below the week’s opener. Wednesday was better, with the pound rising to 1.2487, but it was soon clear the best result had been achieved on Tuesday. That’s because the final two days went the way of the dollar, taking the pound to a disappointing 1.2422 by Friday evening.
So, would things be better, average, or worse against the euro? The pound started trading on 1.1688 here, before rising to 1.1728 on Monday night. We then saw the same dip we’d seen against the US dollar, as the pound fell to 1.1679 on Tuesday. The pattern was slightly different here, though, as we experienced an up-and-down format all week. We rose to 1.1694 on Wednesday, dropped to 1.1683 the day after, and then closed out the week slightly higher on 1.1685 – only slightly lower than we’d begun on back on Monday morning.
There were a couple of rises against the Hong Kong dollar last week – one occurring on Monday to start the week on a good note. This took the pound from 9.7102 to 9.7182. However, the overall trend from there was down, and that meant we ended up finishing on a disappointing note come Friday night. Even though we did well to start with, and on Wednesday too, we still ended up finishing on 9.6521 this time around.
Next, it’s onto the New Zealand dollar, where the British pound began trading on 1.7894 last week. But again, we had a similar picture. Indeed, four out of five of the trading days resulted in a loss for the pound. Two of these came early in the week, meaning that opening rate of 1.7894 soon dropped to 1.7822. This perked up to 1.7914 on Wednesday, before the other two bad days followed. It could have been worse, though – we finished on 1.7819 on Friday night.
Finally, the pound started trading on 1.6343 against the Australian dollar. We were expecting a poor showing here, too, so imagine our surprise when the pound had two good days to start things off. Rising to 1.6478 by Tuesday night at least gave us a good start. We then lost some ground, falling to 1.6471 on Wednesday, before enjoying another two strong days after that. Surprisingly, we finished on 1.6504 by Friday night.
The loss here was thankfully marginal, but it still sent the pound down to 1.6659 from an opening rate of 1.6673 on Monday.
The pound dropped here too, but again, the loss was minimal. It opened on 1.6673 on Monday, before falling slightly to 1.6659 on Friday evening.
The pattern continued elsewhere in the world, too, with the British pound slipping from 141.382 to 139.107 last week.
So, this was a mixed bag of results, although most of them did not go in favour of the British pound. We had seen some good days mixed in, but since most of them came during the middle portion of the week, it was difficult to remember them by the time we saw the latter results at the end of the week.
Clearly, the pound is struggling a little, as it has for a while. However, it remains to be seen whether this will continue, and the losses last week were at least marginal. That means there could be better news in the near future.