The pound hasn’t exactly had the best time of things as the seventh month of 2009 has got underway. As was widely reported online on the major currency and news related websites, the British pound struggled considerably. This news story, taken from the world renowned Bloomberg site, is typical of all the ones which were available to read.
So what exactly happened? It looked as if the pound had found some inner strength from somewhere and things were on the up last month. In fact things were looking rather better than they had for quite some time. But it was an upward stretch that had clearly come to an end, and as such we now find ourselves in the position of reporting on the downward part of the whole episode.
Back on the 1st of July, the exchange rate you would have seen on your currency converter at the close of the day was 1.6463. Now that was quite a respectable start to the month, but as we now know it wasn’t going to continue in that vein.
The difference occurred quickly as well. Just one day later the exchange rate had dropped as the pound weakened against the US dollar, leaving it on a poorly 1.6387. Was it all downhill from here on in?
The 3rd July marked the first Friday of the month, and the rate of loss did slow down at least, as we went into the weekend – clearly with a lot to think about for the following week. But as the first full week of July got underway, would we resume with a downturn right at the start?
Perhaps we were hoping for a better result, or maybe we just expected a small drop to add to the small drop we had on the previous Friday. But as it turned out, what we actually ended up with was a huge shock. We finished up almost in freefall on that Monday, with a final exchange rate for the day of 1.6136. What on earth happened? This wasn’t the start to the month we’d hoped for, certainly.
The pound did rally somewhat the next day, when it crept back over the 1.62 barrier and finished up on 1.6229. But another drop was in store the next day, and it took us to a new low for the month as a whole so far. The finishing rate was a low 1.6071 – the US must have been enjoying this.
The pound clearly wasn’t having any of it though, and it crawled back up again on Thursday to finish on 1.6256. With just one day left to go we were hoping to gain even more, but it was not to be. The final figure for that week was 1.6201 – leaving us wondering if the second half of the month was going to be as bad as the first.
We must just hang on and hope that this bad start won’t turn into a bad ending as well. There is no way of knowing what will happen next, but hopefully things will finish up better than they started out. Are we hoping for too much? Possibly – but we have to have some hope, don’t we?
Isn’t the pound great? You have to admire this currency – it’s been around for donkey’s years, it goes up against other mighty currencies like the US dollar and the newbie Euro, and it struggles so much!
I know it hasn’t always been like that but it does make you wonder whether this is just a pattern that will go on and on and on. Every time the pound perks up a bit, you can virtually guarantee it will end up on its knees again the following week. Makes for interesting viewing though, doesn’t it? At least if you aren’t involved in Forex!
Yes Allison mentioned Forex above, which I am interested in, and I wouldn’t touch the pound with a bargepole either! Maybe other people with more experience in the Forex market have got more confidence in what they are doing. But with all the ups and downs of the pound and the uncertainties about whether it is heading for another nose dive, I wouldn’t be confident in doing it.
Maybe I should steer clear of the Forex market altogether. But the pound does seem to be one of those currencies that just never inspire much confidence in me when it comes to gauging how successful – or not – it will be in the future.