Posted by Allison on 9 March 2010, 03:28
It’s time to find out how the currency markets fared at the end of the first week of March. We started the week in very poor fashion indeed – in fact we can’t remember the last time we had such bad results to report back on. We lost ground against every one of the main five currencies we look at each week, and the figures on the currency converter were nothing short of horrifying.
We were down over two and a half cents against the US dollar, and over a cent and a half against the Euro. But that was nothing compared to the dire results we had over the space of just two days elsewhere as well. We lost out on 0.195 against the Hong Kong dollar, but the worst results were reserved for the New Zealand and Australian dollars.
Here we lost just shy of an incredible four and a half cents against the New Zealand dollar. And the loss against the Aussie dollar amounted to over five cents in just two days. So what on earth will happen over the remaining three days of the week? Have we seen the worst already or is there more to come?
Let’s find out now by pressing ahead and seeing what else is in store for us.
Let’s move to our first stop as usual which is the US dollar. Our closing rate last time after that initial loss was 1.4947, and thankfully we managed to push back up to 1.5061 the following day. There were still two days left to go for the week though, so what would happen there?
Thursday looked a little more promising still as the pound worked hard to gain a final rate for the day of 1.5102. But Friday proved that there was still a lot of work to be done as the exchange rate dropped back to 1.5049. This meant we had at least gained a little over a cent over those last three days of the week.
Moving on to the Euro now, we had a closing rate of 1.1033 on Tuesday evening. On Wednesday this had moved up slightly to 1.1041, and by the same time the following day we were looking at an exchange rate of 1.1049. It was only creeping up slowly, but it was better than heading in the opposite direction.
The final rate on Friday evening as everyone quit for the week was 1.1080, so we had at least recovered a bit of ground. The total increase since Tuesday night was only just under half a cent though, so there was still more work to be done.
Hong Kong is our next stop, and the pound was worth 11.604 when we left it on Tuesday night. Just twenty four hours later it had managed to improve its position here too, with a slightly better rate of 11.691. But could it do better than this as well?
The answer was yes on Thursday, as it improved further to 11.724. Unfortunately that would be as good as it got, as the rate dropped back to 11.682 on Friday night. We were still 0.078 better off than we had been on Tuesday evening though, so that was something.
In New Zealand the pound had dropped back to 2.1450 on Tuesday night, but thankfully the second half of the week was a lot better than the first half. By Wednesday evening the rate had shot back up to 2.1825, and the pound even managed to go higher to 2.1907 on Thursday. It slipped back to 2.1837 as the week came to a close but at least we had claimed back nearly four cents during the second half of the week.
Finally we have the Australian dollar, and here we left things on 1.6543. Could we replicate the result we had seen in New Zealand?
We did improve things but they didn’t improve by as much. Wednesday saw a figure of 1.6689 followed by a marginally better 1.6739 the following day. But Friday came to a close with a rate of 1.6668, so we had only gained a total of 0.0125 all in all.
They may both have done well against the pound, but it was the Aussie dollar that came out on top over the New Zealand dollar. The New Zealand dollar dropped from 0.7712 on Tuesday night to 0.7632 on Friday.
Two other dollars were fighting it out as well towards the end of last week. The Canadian dollar finally went from 0.9657 on Tuesday night to 0.9693 on Friday.
There wasn’t much to choose between them and they went up and down like a yo yo for much of the second half of the week. But eventually the Euro dropped from 174.182 on Tuesday night to 174.034 on Friday night as the markets closed.
Those are the results for the second half of last week, and as we can see the pound did at least start to fight back after the disastrous first half. We can only hope these efforts can be prolonged.
It’s always interesting to know why certain currency situations come to the fore. And after the first half of last week proved to be so disastrous for the pound, you might be wondering how and why it managed to pull its socks up so strongly for the second half of the week. The reason is contained in this report from the Reuters website. It makes interesting reading and there are other reports on the site for the same day that you can also read.
So let’s hope the next week or two pans out in much the same way for the pound. We need some good news and this could be it.