January ended last week and gave way to a new month for the British pound to contend with. Would it be a good one or would there be early signs of bad news to come? We’ll soon find out.
An overview of the currency markets for January 29th – February 2nd, 2018
A curious week began for the British pound versus the US dollar. Day one was far from a good one, with the pound dropping from its opening rate of 1.4239 to reach a low of 1.4076 by the close of play. However, the next three days were far better, recouping those losses almost completely, and finishing on 1.4235 on Thursday night. Unfortunately, we did see another loss on Friday which undid some of that hard work. This meant the pound closed out the week on 1.4219.
How would things progress against the euro? This is uncertain territory at present, and never more so than this week. The pound opened trading on 1.1450 before dropping to 1.1371 on day one, in much the same way it had against the dollar. Again, we then had three much healthier days, seeing the pound rise to 1.1425 by Thursday evening. And yes, that meant we had an identical drop to close the week, just as we had against the dollar. Here, we ended on 1.1383 against the euro, down on our opening rate.
It soon became clear we were going to follow that same pattern against the Hong Kong dollar too. If anything was going to change, it may just be against the New Zealand and/or Australian dollars, which we will come to shortly. Here, the pound began on 11.132 against the Hong Kong currency, before falling to 11.005 on Monday night. By Thursday, we regained the position we had started on, at 11.132, before experiencing that same final fall once again. This took us to a closing rate of 11.120 for the week.
We wondered if the pattern would change against the Kiwi dollar and indeed it did. This was an up-and-down pattern, and one that led to three drops and two rises over the week. We started on 1.9400, with the lowest rate over those five days a mere 1.9113. While we did finish on a higher note than that, the final figure of 1.9305 was lower than we’d begun on.
So, could we expect a similar picture against the Australian dollar as well? We started on 1.7610 before dropping to 1.7400 by Monday’s end. It soon became evident we were broadly going to follow the pattern seen against the US dollar, but this would garner a different result. We did enjoy three good days after that poor start, but the surprise was that Friday was also a good day – something we haven’t seen elsewhere. That meant the pound ended in good shape on 1.7791.
Notable events in the world of currency
A slight fall against the Canadian dollar
Here we did stumble, but it was a marginal one. We began trading on 1.7547 before dropping to 1.7515 by Friday night.
A notable drop against the Swiss franc
The pound did poorly here, falling from 1.3318 to start the week to a disappointing 1.3199 by the time it was over.
Another slight fall, this time against the Icelandic krona
There was bad news here too, although the pound did recover from two poor days to start with. Overall, it dropped from 143.319 to 143.252.
So, this was an uncertain week for the British pound. We sense there could have been far worse results to report, but overall it managed to stem its losses. However, after a reasonably positive start to the year, January gave way to February in a far more uncertain manner. Would this be the beginning of a prolonged and troubled time for the British pound, or will we be back to reporting far better news next week? We shall have the answers for you soon, so make sure you don’t miss our next report fresh from the currency markets.