Posted by Allison on 3 November 2009, 10:01
So another week has passed us by and it’s time once again to see how the British pound did against five of the world’s other major currencies – the US dollar, the Euro, the Hong Kong dollar, the Australian dollar and the New Zealand dollar.
Last time we saw that most of the differences in the exchange rates were small ones. The most notable exception to that fact was the New Zealand dollar, which definitely came out on top as the British pound lost around four cents against it.
Elsewhere there were tiny gains and tiny losses, which were definitely better than the bigger losses we have seen before – and indeed we saw against the Kiwi dollar too of course.
So what can we expect this week? Well it is hard to tell at this point, as we have seen both very good and very average results in recent weeks. It would be good to say that there were more good results on the way, but as always we must hope for the best and simply wait for the actual figures to tell us the real story. It has seemed rather quieter in the past week than it has done in previous weeks with regard to news stories though, so perhaps this will be uneventful in the grand scheme of things.
So are we about to look back at a week where nothing much of note happened? Or will we be looking at a week that might just surprise us? Let’s take a look right now to see how things panned out for the pound, shall we?
We barely managed to add on half a cent against the US dollar last time around, although considering the performance we have put on overall that isn’t actually a bad result.
But what happened next? Did the British pound manage to build on that result and produce something even better this time? Let’s see what happened.
The starting point was 1.6375 this time, so we were quite a way away from the $1.50 level that we had previously been hovering near for some time. Hopefully those days are long since in the past, but could we move even further away from them this time?
There was very little to talk about on that first day at any rate, since closing time resulted in an exchange rate of 1.6335. But that first blood had gone to the US dollar, so it would certainly make the rest of the week worth watching. Could the pound pull back and get started on the week properly the next day, or would the dollar pick up pace and pull even further in front?
As it turned out the pound was going to do better, and by the end of that second day the exchange rate was looking a little healthier on 1.6385. This was going to be a week where we would see lots of changes on a daily basis, so it was a good idea to keep the currency converter close at hand.
The momentum swung back in the other direction on Wednesday though, as the dollar exerted a bit of pressure and pushed the pound back down to 1.6324 as a result. So we now had two days left to go and with an up and down momentum that wasn’t going to either currency for very long, which one would finally take the lead at the end of the week?
Thursday gave us what could possibly be a clue as the British pound suddenly rose up to 1.6476. Could this be another good week for the pound against the US dollar? The rise of around half a cent the previous week wasn’t exactly a huge rise, but it was something – and the same again could result in a much better exchange rate for the pound.
So there was a single day of trading left to go now, and if we were hoping for more good news for the pound we certainly did get it. By the time the week came to a close and the markets stopped trading for the weekend, the British pound stood at 1.6559 against the US dollar. That gave us an improvement of nearly two cents all in all – which was an impressive success for the pound.
So let’s move on now to see whether that was a one off or whether there was more to come in the way of strengthened exchange rates against the other major currencies. Our second stop on our round the world trip in this respect is Europe, where the Euro saw us end up on 1.0902 last time: a mere half a cent lower than we had started out.
The week did not start well against the Euro, with a closing exchange rate of 1.0876 on the first day. This mirrored the results we had seen in the US though, so it was a little too early to think this may not be our week. What would happen next?
We weren’t prepared for what actually did happen next, because not only did things start going in the way of the pound, they jumped in that direction by quite a distance. The closing rate applicable at the end of Tuesday was 1.1016 – nearly a cent and a half higher than the exchange rate had been just twenty four hours earlier.
Things kept on going in our direction the very next day, although the rate of improvement dipped down a little bit. The final rate by the end of the day was 1.1041. But with two days still to go, if we could keep up this upward movement we stood a nice chance of ending the week on a much stronger note against the Euro.
So what did Thursday have in store? Would we manage to add on some more against the Euro, or would it be the Euro that won the day?
Luckily for the pound the strength it had shown so far stayed with it. We managed to add on another whole cent against the Euro, finishing on a rate of 1.1142 at the close of play. So with just one more day to go until the weekend, it looked as though this would be a good week for us.
And indeed that did turn out to be the case. By the time the week was out the British pound stood at 1.1188 against the Euro, which meant we had added on nearly three whole cents during the course of the week. That is easily the best week we have seen in a long time, so let’s hope it is a sign of even better things to come in the future.
So where do we head to next? The answer is our usual third stop on the route – Hong Kong. This was a good result last time, with an increase of 0.053 all in all. This left us standing at 12.691, so could we better that this time?
Once again we saw the start of the pattern we had seen elsewhere this week, with a dip down to 12.660 by the close of play on Monday. But Tuesday bucked things up a bit as the pound came back to close on 12.698. Could it now progress towards the 13.000 mark as the week got towards the midway stage?
Wednesday proved to be a disappointing result as the pound lost its way slightly and finished up on 12.651. But we still had two days to go, and as we had seen with other currencies it was possible that those last two days would be all we needed to grab another good result for the week as a whole.
So how did Thursday pan out? Well, as it turned out that upward swing we were hoping for didn’t let us down. As the day wore on it was looking good for the pound, and the final exchange rate was pegged at 12.769. But could we still do better with just one more day to go until the weekend?
Indeed we could. The final rate for the week was 12.833, which meant that the pound had once again come out on top – this time by a total of 0.142, which was even better than last week’s gain.
But on to New Zealand now, which let us down badly last time. After gaining four cents the previous week we promptly lost it all again, leaving us wondering what on earth we could expect this time around. The starting point was 2.1665, so anything better than that would be enough to cause a celebration.
So the first day actually bucked the trend and saw a slight increase for the pound, rising to 2.1682 overall. What did this mean for the week as a whole? Well, anything could happen with this particular currency so let’s just see how things panned out.
Tuesday brought a nice surprise as the pound jumped up to 2.1919, but we still had to hang onto that for another three days if we wanted to finish the week on a lighter note. That started looking like a distinct possibility though once Wednesday came to a close – as by that time we were on 2.2220.
This was turning into one of those hard to believe weeks, and it got better still when Thursday was over and the exchange rate was up to 2.2623. A much smaller jump on Friday left us on an unbelievable 2.2764 to round off the week. If you haven’t been keeping track of all those lovely increases, we managed to add on a total of very nearly eleven cents – 0.1099 to be exact – over the whole week.
Now that’s what we call a resounding success! And it does redress the balance from the poor results we have been seeing for a while now against the Kiwi dollar.
So finally let’s move across to the Aussie dollar – which as we know often mirrors the result seen against the New Zealand dollar. Will it do the same this time?
The last exchange rate we have is 1.7700, after a loss of 0.0082 across that whole week. But if we were hoping to see signs of improvement on the very first day, we didn’t get them. The closing rate that day was 1.7677.
That was going to be the extent of the bad news though, because the exchange rate the pound managed to get to by the end of Tuesday was an impressive 1.7845. And that really set the tone for the rest of the week, as the improvement we were hoping to see soon set itself in motion.
Wednesday recorded a closing rate of 1.8026, and the big leaps ahead were to continue until the end of the week. Thursday saw a rate of 1.8134, and we finally closed on Friday evening with a true flourish as the pound recorded an exchange rate of 1.8208 against the Aussie dollar. That meant we had added on just over five cents in total – making it another good result for the pound.
So as you can see we had plenty to celebrate last week, with possibly the best set of results we have had in a very long time.
It’s always interesting to pit these two against each other, and last week was no exception. From a starting exchange rate of 0.8169, the Kiwi dollar could only limp home on 0.7998 at the end of the week.
The US dollar started on 0.6657 against the Euro last week, but it soon managed to improve on that. By the close of play on Friday it was on 0.6756.
The previous week had ended with the Swiss franc claiming 0.6608 against the single currency. But just one week later that had changed very little; it had seen a change to 0.6612 overall.
It is always interesting to hear views from those in the financial sector about the state of the global economy. Last week a major banker in the Australian banking system gave his views; you can read more on the Reuters website.
So there we have it for another week. Make sure you are back next week to find out whether this resounding success for the pound can be continued. We’ll see you then.