Posted by Allison on 27 July 2010, 11:10
Welcome back to another information packed report on what has been happening on the currency markets. If you will remember, the beginning of last week did not bode well for the British pound. We lost ground against every single one of the five currencies we check on the currency converter each week. While some losses were not as big as others, we definitely did not have a good time against any of them.
Hopefully the week will end in much better shape than it started as far as the pound is concerned. Shall we see whether that pans out to be true?
Let’s begin by looking to see if the pound could regain any ground against the US dollar. On Tuesday night we finished with an exchange rate of 1.5156, so could we improve on this or would we be in danger of slipping back below the $1.50 rate?
The first result was certainly a good one, as we finished on Wednesday night with a rate of 1.5268. This slipped slightly the following day to 1.5246 but then on Friday we finished in fine fashion, ending the week on a much healthier 1.5404.
Could we do as well against the Euro though? Our starting rate here was 1.1800 and just twenty four hours later that had changed to 1.1912. Once again Thursday had a slip in store and we finished on 1.1865. But the pound finished strongly on Friday on a rate of 1.1944. Another good result to add to the one we have already got.
Next it is on to Hong Kong and their dollar – could the pound improve on 11.785?
The same pattern would be followed here with a better rate of 11.870 on Wednesday night, a dip to 11.852 on Thursday and then a rate of 11.968 on Friday.
Let’s see whether this trend can continue against the New Zealand dollar now, as we start from a rate of 2.1384. Unfortunately it didn’t, as we dropped back to 2.1241 on Wednesday evening and then again to 2.1161 on Thursday. We clawed back something on Friday but only as far as 2.1190.
Finally we have Australia to look at, where the pound finished on 1.7367 last time. The problem was the pattern against the New Zealand dollar looked to be repeated again here, as we fell back to 1.7257 initially. This was followed by a drop to 1.7176 the next day, and it closed out the week on 1.7232.
So it was a better end to the week in some quarters, but not in all of them.
From a rate of 1.0872 on Wednesday evening, the Swiss franc closed out the week on a lower rate of 1.0696.
The second half of the week saw a good amount of progress for the Aussie dollar. It went from 0.8726 on Wednesday morning to 0.8939 on Friday night.
It wasn’t such a good time for the Euro though, as it fell from 1.8122 to 1.7741 over those same three days.
As you can see from the results above, it was certainly a mixed week of news on the currency markets last week. It could certainly have been worse for the pound, although the week could have ended on a stronger note as well.
A fascinating story was revealed on the Bloomberg site at the end of last week, concerning Hungary. You can read the story here. One of the results of this news is that Hungary’s currency has fallen once again; it has been in some trouble over recent months and this next stage has not done it any favours at all.
We shall have to wait and see whether things change in any way for Hungary over the next few months. It is just this kind of news that can lead to a currency falling on the markets though, a fact which Hungary’s government is no doubt painfully aware. We will be back with more updates in a few days.