Posted by Allison on 11 January 2010, 14:08
After two weeks of partial results to bring you from the Christmas and New Year period, we can now return to normal and have the first week of results from the New Year.
And we had a really mixed bag of results as far as the currency markets were concerned for the last few days of 2009. The British pound managed to get good figures on the currency converter for three of the five currencies we take a regular look at. But the other two did badly.
The three good results were as follows. The pound had a very good ending to the year against the American dollar, adding on nearly two and a half cents all in all. The pound didn’t do quite as well against the Euro, but it didn’t finish off the old year without taking forward an increase of just over one and a half Euro cents into 2010.
The Hong Kong dollar was the third currency to struggle against the British pound as we said goodbye to 2009. The British pound managed to add on a total of 0.185 against this currency, so those were certainly three good reasons to bid farewell to 2009 with something of a smile on our faces.
However the news was not as good everywhere. As usual we saw that when some currencies don’t do as well, the pattern is repeated elsewhere also. And this was the case with the New Zealand dollar and the Australian dollar.
The pound managed to drop a full three and a half cents against the New Zealand dollar last time around. But while it lost ground against the Australian dollar too it wasn’t nearly as much, thankfully. Here we saw a drop of just half a cent, leaving us wondering where we would end up this time around for the first full week of the New Year.
So with that thought in mind let’s go to the new week of results now to see what actually happened.
So the shortened week that we looked at last time saw the last result pegged at 1.6221 between the US dollar and the British pound. But could the pound kick off the first week of the New Year by improving on that exchange rate?
Let’s find out what happened. In actual fact we didn’t get started on the right foot at all, kicking off with a loss to start 2010 with. By the time Monday night rolled around the pound was worth 1.6142 US dollars, having lost out on 0.0079 overall. Could we chalk this up to a slow start and forget about it by the end of the week, or was it a sign of more to come?
We would have liked the former statement to be true but unfortunately it looked as though the latter would be more truthful. Tuesday pressed on and the pound did its best but in fact the finishing exchange rate on that day turned out to be 1.6038. We were getting closer to dipping below the $1.60 rate and we were only two days into the week at this stage. It certainly didn’t bode well, did it?
And in fact it only took another day to record an exchange rate that did go below that level. By the time Wednesday was over the exchange rate had gone down to 1.5969, giving us more to wonder about and potentially a rotten week to kick off the New Year on. Was there anything we could do to turn things around, or were we destined to think along those lines for next week instead? It could already be too late to do anything this time.
And indeed that did seem to be the case. Despite the pound’s best efforts we just couldn’t seem to do anything to change the way we were heading. This was borne out by the result we saw on Thursday evening, when the pound was claiming just 1.5900 US dollars. The only question now was whether we could salvage anything on the last day of the week, or whether we would have to wait for the following week to try and do anything about it.
The answer was perhaps something of a surprise, because the final exchange rate we managed was 1.5976. So at least we had added on a total of 0.0076 on the final day of the first trading week of 2010. But we had still lost out on 0.0245 overall.
So what would happen between the pound and the Euro? Would this poor result be replicated there or was there better news in store?
Let’s find out what happened. We were starting on 1.1259 this time, but once again we didn’t get off to the good start we were hoping for. Monday evening’s result was recorded at 1.1218, as we had dropped a total of 0.0041 during the day.
Once again it seemed we were starting off in the wrong direction, and once again that feeling continued into the following day. Tuesday brought a closing rate of 1.1105, so we had plenty to think about as we headed into the next phase of the week.
There was a slight improvement on Wednesday as the pound managed to scrabble up to a marginally better position. But even then it was not much to celebrate as the improvement only went as far as 1.1128. It didn’t seem enough to be hopeful that we could turn things around – and we certainly couldn’t follow through on our good intentions and thoughts. The results we were getting were simply not good enough.
And once again Thursday showed us that a small increase midweek doesn’t always bode well for the remaining couple of days left to us. In this case Thursday’s exchange rate dropped back once again to 1.1116. So we had to hope that we could change things or try and pull back some ground at least by the time Friday evening arrived.
We did at least manage to do that though, as the pound finished off the week against the Euro on 1.1193. That equated to a loss overall however, this time of 0.0066. So it could have been worse than it actually was in this case.
Moving on swiftly from those two initial losses, what else can we hope to achieve? Our next stop is the Hong Kong dollar, and last time we left it on 12.578. So far however two of the good results we had seen last time have turned into bad results this time. Will it prove to be the same for the Hong Kong dollar?
The first exchange rate of the week did not make us feel confident that we could buck this particular trend. By the close of play on Monday evening we were claiming just 12.520 Hong Kong dollars. Where would that initial drop lead us now?
Tuesday gave us the answer and it wasn’t good. The closing rate for that day was even lower at 12.440. This seemed to be a slippery path that we could not get off – an idea that was borne out the following day when we slid a little further down to 12.384.
But there were still two days left to go and some determination to try and turn things around might just help to achieve that. Thursday proved that hope was not always what it was destined to be though, and the British pound finished up with just one day to go, having lost out once more and slipped down to 12.331.
It seemed too late to do anything about this unfortunate turn of events. And indeed it was – but we did at least manage to put the brakes on and start to turn in the opposite direction. By Friday night of that week we had claimed an exchange rate of 12.390 to stop the rot. We had lost a total of 0.188 overall – but if it hadn’t been for the last minute reprieve it could have been a lot worse.
Our closing rate against the New Zealand dollar last week was 2.2298. But it had been a bad week all in all, experiencing a loss of three and a half cents overall. Could we turn things around this week?
Well we certainly didn’t seem destined to get off to a good start anywhere this week. By the time we had finished on Monday the pound was worth 2.2171 New Zealand dollars – less than it had been worth the week before. Was there anything we could do to gain at least one good result to start the year with?
If there was we certainly didn’t find out what it was on Tuesday, because there was another drop in store for us – and this time it was a big one. The closing rate on that day was a much lower 2.1775. And even though we managed a marginal increase to 2.1778 the next day, it simply wasn’t enough to make us feel positive in any way at all.
And once again Thursday got rid of even that small increase. This time we finished the day on 2.1716, giving us little hope of anything other than another loss to finish off what had been a dreadful week against this currency.
There was a small surprise in store though as the British pound clawed back some of its losses to finish on 2.1900 on Friday night. This did at least mean we could limit the total losses of the week to 0.0271, so we should at least be grateful for small mercies.
And finally we have one more currency to look at – the Australian dollar. Last time we left it on 1.8025, but as we know this currency so often mirrors the Kiwi dollar in terms of exchange rate results. And with four losses so far this week, there was little hope that the final currency would produce anything but another loss to go with the rest.
So let’s see whether we are right. The closing rate on Monday night of 1.7820 certainly seemed to bear out our idea, and when that dropped even further to 1.7512 the following day there was only one question left to answer. Just how big would the losses be this week against the Aussie dollar?
The losses slowed considerably the next day to 1.7446, but there was still a lower figure there and the Aussie dollar was still getting the better of the pound. And if we thought the losses might stop there we were wrong – there were yet more to come in this washout week.
Thursday saw a closing rate of 1.7353 and with just one day to go there was no real chance of a reprieve for the pound. We would have to settle for a loss right across the board this time around, and the closing rate for the week against the Aussie dollar was 1.7472. This meant we had lost out on over five and a half cents, giving us a dreadful result to finish up with.
Better luck next time seems to be a phrase that is most apt for this week’s results.
The Canadian dollar broke through a significant barrier last week against the Swiss franc. It was claiming 0.9946 on Monday night and by the time the week was over it was on 1.0023.
This was a fairly static result between these two currencies – the US dollar was on 6.8272 on Monday night and 6.8275 on Friday night. So there was very little to report here.
It certainly wasn’t a remarkable week for the US dollar. From 1.0391 on Monday night to 1.0355 as the weekend took hold, it did manage a slight improvement against the Canadian currency, but not by much.
Some of the reason behind the British pound’s bad week last week is revealed in this news story on the Reuters website. It is worth looking at other news stories on the site too, as they reveal more about what happened in this disappointing week.
So there we have it. Not the best start to 2010 by any means, but at least we can hope to make solid improvements next week. Whether those hopes will turn into reality or not remains to be seen however.
We’ll see you then.