Posted by Allison on 15 September 2009, 20:25
If you have been following our reports over the last couple of weeks, you will know that we’ve had a thoroughly bad week followed by a thoroughly good one. So of course we are now hoping that we can keep up the trend we set last time, and get some great results once again.
But when you take a closer look at the results we garnered last time, you will notice that there are no huge jumps ahead there to be celebrated. Most of the increases against the likes of the US dollar, the Euro, the Hong Kong dollar and the New Zealand and Australian dollars were small. And in fact the word ‘miniscule’ could have easily been used in one or two cases!
So what could we be in for this time around? Will there be another string of good results all round for the British pound (even if they are only small ones) or is that too much to hope for? It does seem a lot to ask to get two good weeks with no bad results at all, especially given the situation we are in at the moment. The pound is quite weak overall, and we could be asking too much to have another round of good results so soon after the previous ones. Although having said that, don’t forget that word ‘miniscule’! Perhaps that was merely building up to this week’s results?
In any event there is only one way to find out how well the pound did last week, and that is to take our usual journey through the results that were gained through the currency markets. If you haven’t been keeping an eye on the currency converter, now is the time to find out how things went.
So here we go with our usual first stop on the route through the world, with a look at the pound versus the US dollar. Last time we had added on a tiny 0.0003 to the exchange rate, leaving things on 1.6355 all in all. Let’s see what happened the following week.
We’re always keen to see a good start to the week, as it gives us something of a cushion to work with. And here we are with exactly that, because the British pound managed to up the ante against the US dollar with an opening salvo of 1.6405 last week.
That was certainly a healthy start, and now it was time to see whether the pound could build on it, or whether it would let that early lead slip away.
If that first day was encouraging, the second day was even better. By the time the markets closed on Tuesday we were looking at an exchange rate that had gone even higher – to 1.6566. That was a cent and a half up on the previous day, adding on around two cents since the previous week’s closing rate. Could we do even better and add on even more before the week was out? Or was that the best we could hope for?
Perhaps predictably things did slip a little the following day – that midweek point – but it wasn’t too bad, as we only fell back to 1.6515. You still had the distinct feeling that the British pound was the one in charge for a change, and not the US dollar.
And luckily by the end of Thursday evening that slip didn’t even matter. By that time we were looking at another improvement – this time to 1.6608. With just one day to go and so many increases so far, could we hope to succeed and grab a great week all round against the US dollar? We have had so many bad weeks against this currency in recent months it would be nice to have a success for once.
And that is exactly what we did get. Because by the time everyone quit and went home for the weekend, the British pound was standing proud against the US dollar, claiming a total of 1.6699. That meant we had added on nearly three and a half cents all in all – and that counts as a very successful week indeed.
So could we mirror this success over in Europe and give the Euro something to think about as well? Our prize the week before was almost a whole Euro cent, which took us up to 1.1467 at the end of the week. What could we achieve this time?
If we were hoping for a good start as we had enjoyed against the US dollar, we weren’t going to get that here. Luckily we didn’t lose too much ground either, and finished up on 1.1448 as Monday drew to a close.
And once again Tuesday produced very little change either – in fact, even less than we had seen before. The final figure on the second day of the week was 1.1446.
So this was clearly going to be a very different battle than we had seen against the US dollar. The Euro wasn’t going to give up any ground easily, and we were going to have to fight for every inch of the exchange rate if we wanted to make it better than it had been at the start of the week.
And indeed the Euro showed us on Wednesday that it had no intention of letting things slide. By the close of play when everyone headed home and the rates were frozen overnight, the Euro had stormed back and pushed the pound back to 1.1372.
This came as something of a shock, and we had just two days left to try and put things right. In a situation like this the first task is to hope that we can try and equal the point we started off from. Anything better than that is something to be hoped for.
But could we do it?
Well Thursday certainly set us off in the right direction. We managed to crawl our way back up to 1.1418, before falling a little way short and ending up on 1.1442 at the end of the week. That meant we had only lost a little bit of ground, but the Euro had still got the better of us as we’d dropped a quarter of a cent all in all.
So where are we headed next? Our third stop as always is Hong Kong, where their dollar awaits us. Last time we saw an increase of 0.001, leaving us on 12.675 at the end of the week. Could we improve on that as we had against the US dollar, or would we go the way we did against the Euro this time?
Once again we started well – which bucked the trend we had followed against the Euro for starters. We finished on 12.714 on Monday, leaving us something to think about as Tuesday rolled around, introducing a fresh day to do battle on.
And a fresh day it was too, with a sterling performance – pardon the pun – put in by the British pound. By the end of the day it had all but left the Hong Kong dollar in the dust, with an exchange rate of 12.839 on the cards. That was a full 0.125 more than we had settled on the day before, so that was truly something to be celebrated.
This brought a result of 12.799 on Wednesday evening, which was perhaps predictable given the high of the day before. So often we see the balance being righted somewhat yet again, after a big increase by one currency against another. The question now was whether we could improve on that and get back into the driving seat once again on Thursday, with just that and one more day left in the week as a whole.
The answer was yes – and we did it in style too. This wasn’t just a small increase we managed to garner, it was a big one. And it saw us finishing on an impressive 12.872 on Thursday evening, leaving us to wonder what we might be able to achieve on the last day of the week.
We have often seen a last minute and very disappointing dip in these kinds of situations. But that would not happen this time. This time, it was the turn of the pound to turn on the pressure and keep its place ahead of the Hong Kong dollar. And with that, the final exchange rate was an impressive 12.942. That equated to an all out increase of 0.267 over the week as a whole – and we reckon we can include that as a resounding success!
Our last figure last time against the New Zealand dollar was 2.3911, after adding on around a cent. But since we had lost nearly five cents the week before that, we were looking for something a bit more impressive this time around. Could we do it?
Unfortunately we made possibly the worst start we could ever have hoped for. By the time everyone finished on Monday night, the pound was bringing in a dismal 2.3693. This was nothing short of embarrassing, not to mention a shock. What could we do to try and conquer this result?
Well we managed to up things a bit on Tuesday and claw back some of those early losses, with an increase to 2.3796. But had we left ourselves too much of a task to complete, after that early loss had shaken us?
It seemed we had. By Wednesday evening we were sitting on an exchange rate of 2.3676. What could we do except to hope we could pull back something and hope the loss overall wasn’t too bad?
Thursday was much better, with an increase to 2.3866 on the cards. Could it be that we had left our comeback until the very last moment? If we could just add on half a cent or so we would be back to where we had started the week originally. Under the circumstances that didn’t seem too bad.
But unfortunately we went the other way. As the week finished the British pound stood at 2.3641 against the New Zealand dollar – having lost a total of 0.027 cents overall.
Could we do better in Australia to finish the week off though? We’d added on half a cent to claim an exchange rate of 1.9397 the week before, so anything better than a loss this time would be something to celebrate. Did we manage it?
Once again the week couldn’t have got off to a worse start. The figure we were faced with on Monday evening was a dismal 1.9173. It barely got a little better on Tuesday when the exchange rate crept up to 1.9195. It didn’t seem enough. And that lack of strength really showed on Wednesday as the pound dropped back a little further to land on 1.9147 for the day.
There was better news in the offing on Thursday though, as the pound found some strength from somewhere to end up on 1.9371 at the close of play. That equated to an increase of more than two cents over the whole day – but would it be enough to build on for an increase over the week as a whole?
The final exchange rate that decided it came in at 1.9347. And that meant it was the Australian dollar that had reclaimed the half a cent it had lost to the British pound the week before.
So it was a mixed bag last week – and that was perhaps to be expected after the great week we’d had previously.
At the close of play on Monday it sat on 1.6748, but by the time the week was over the Euro had got the Aussie dollar on the run. The final exchange rate was 1.6908.
The New Zealand dollar was the best of the two last week when it squared up against the US dollar; from standing at 1.4442 on Monday night the US dollar dropped to 1.4156 by the week’s end.
Some victories are easy, and so it was with the Swiss franc against the Hong Kong dollar last week. A closing figure of 7.3159 on Monday finished up transforming into 7.4721 by Friday night.
The Euro has had a good year so far according to a lot of reports online. A mid September report from the Reuters website indicated that it had made good gains over time. You can read the report here.
So there we have it for another week. Make sure you are here with us again next week to see if the British pound can recover its losses, and build on its gains. We’ll see you then.