Welcome back to our weekly report which brings you the latest news on what is happening in the currency markets. And if you were paying attention last time around you will know that the British pound had a very good time indeed. It added on a huge amount against every single one of the five currencies we usually take a look at.
Here are the results (and they are worth repeating even if you did see what happened last week):
* Up 2 cents against the US dollar
* Up 3 cents against the Euro
* Up 0.142 against the Hong Kong dollar
* Up a huge 11 cents against the New Zealand dollar
* Up 5 cents against the Australian dollar
Some of those amounts are rounded to the nearest cent of course, but even then you can see that the British pound had a resoundingly good week. But will the currency converter return such good exchange rates for us this time around as well, or was that simply a one off event that will not be repeated?
It’s hard to predict what could happen next, but if this is the beginning of a good run of results for the British pound then we could be in for another interesting week now. However there is only one way to find out what did happen last week and that is to take a closer look at the figures. Let’s do that right now, shall we?
An overview of the currency markets for November 2nd – November 8th 2009
So here we go with the first look at what the British pound managed to achieve last week. With the increase of two cents last time – or very nearly – we had every reason to feel optimistic this time. But what happened in reality?
Well our starting point this time was an impressive 1.6559, so could we add anything else onto that?
As it turned out Monday started us off in the wrong direction, as by the time the day was over we were standing at 1.6353. So already we had lost out on just over two cents; and since we had added that same amount on through the whole of the week before this wasn’t exactly the start we were looking for.
Not to worry though, as it was early days yet and we still had four days of trading left to go. Tuesday didn’t exactly make us feel any more confident though, as the exchange rate had gone down further by the time the day was done, leaving us on 1.6312 at the close of play. At least the rate of loss had slowed significantly though, with just 0.0041 lost over the day as a whole.
So onto Wednesday now, and the midweek point often gives us an idea of how the rest of the week might go. It is all still speculation of course but a positive sign here does somehow give us more to hope for as the remainder of the week gets underway.
And here at least we did receive a very positive sign. By the time everyone had finished trading for the day and headed home the exchange rate had perked up considerably to 1.6518. Ironically we had now added on the two cents we had dropped very early on in the week, so although the British pound was still slightly lower in value against the US dollar than it had been, it was doing better.
As Thursday came to a close things were looking better still and we were getting hopeful that we could actually pull out a good result after all. By the time the evening was over we had finished on a more than respectable 1.6605. But could we hang onto the $1.66 territory in the hope of finishing the week higher than we had started it?
Unfortunately the answer would prove to be in the negative. By the time everyone had finished trading for the week and the weekend beckoned, the final exchange rate in evidence was 1.6587. That meant we had finished in a better position than we had started off in, with a nominal increase of 0.0028 in evidence. It wasn’t quite enough to finish the week in the $1.66 territory, but it was an improvement.
So let’s move onto the Euro now to see whether we could bag another good result against that currency too. With a three cent rise last time we were hoping for an equally good result now, but it almost seemed too much to hope for right from the start.
The starting point here was a respectable 1.1188, so what could we do to improve things?
Well as we saw with the US dollar, things didn’t get off to a good start here either. By the time Monday was over and done with, we were down to 1.1070. That had lost us just over a cent of the three cents we had added on the previous week, which certainly made us sit up and take notice when it came to what might happen over the rest of the week.
Tuesday went rather more happily though, as the exchange rate by the end of the second day of the week settled on 1.1128. That was still lower than where we had started from, but we were now heading in the right direction once again.
The midweek point was also kind to us as we managed to add on more Euros to the pound, leaving us sitting pretty on 1.1190 as the third day came to a close. So with just two days to go things were going in our favour – but would they continue to do so or would the Euro find a way back in to cause problems?
Well you can never put the Euro down because it has a habit of getting the better of the British pound, at least of late. And it was no different this time either. By the time Thursday was over we were on 1.1169, and as Friday brought the week to a close the exchange rate had gone down even more to 1.1160.
At least the amounts that we were losing were small ones, and when all was said and done the pound only lost out on a small total of 0.0028 over the whole week. Not a good result, but it could have been a lot worse.
Let’s take that to heart now and move across to Hong Kong to see what happened there. The starting point here was 12.833, and with an increase of 0.142 on the cards last time, could we think seriously about attempting something similar this week too?
Once again the first result, brought to us at the end of Monday, was a loss. The British pound was down to 12.674 Hong Kong dollars by the close of play. But could it regain its momentum and have a better end of the week instead?
There was another drop in store the following day to 12.642, but this was perhaps to be expected given the results and the patterns seen against the US dollar and the Euro. What would Wednesday bring?
As it turned out Wednesday brought a better result with an exchange rate of 12.802 in the bag by the end of the day. We were still down on the closing rate of the previous week though, so which currency would come out on top by the time everyone headed for home on Friday night?
Things were looking good for the pound on Thursday evening, with the exchange rate back up to a healthy 12.869. But even then it was a possibility that Friday could swing things back in the direction of the Hong Kong dollar, so there was still all to play for.
And in fact there was a slight swing back in the opposite direction, as the Hong Kong dollar fought back to leave the pound sitting on 12.854 at the end of the week. That meant the pound had still won overall though, with a small margin of 0.021 all in all.
So with two good results in the bag and one small disappointment overall, let’s see what happened in New Zealand last week. We had achieved a phenomenal rise of eleven cents the week before, so it seemed very unlikely that we could hope to do better still this time. Or was that just being a little pessimistic?
Let’s see how things turned out in reality. We were starting from 2.2764 after the success of the previous week, and by the end of day one that had changed to 2.2707. Only a small drop, but perhaps the huge increase was now being brought back down to size.
However Tuesday brought an increase of just over a cent, with the final exchange rate for the day being 2.2836.&nb
sp; Could we keep this up or would we be suffering more losses towards the end of the week?
As it turned out the news was going to be good for us. By the close of play on Wednesday we were on 2.2843, so things were steadily heading in the right direction. And as if that wasn’t enough, Thursday brought us the best exchange rate of the whole week, as we managed to break through the $2.30 barrier. That left us on 2.3015 overnight.
But of course we did say that this was the best result of the week. That means Friday went slightly lower although thankfully not by too much. The final exchange rate of the week was 2.2937. All of which means that last week the British pound got the better of the Kiwi dollar once again – this time to the tune of 0.0173.
So did we manage to replicate that success over in Australia as well? After an increase of some five cents last time, we finished up on 1.8208. But could we do better still?
Well once again we saw a drop on day one, as we sank back to 1.8070. But not to worry as this seemed to be a regular event on this occasion. And indeed Tuesday backed that up by giving us a good result and pushing the exchange rate back up to 1.8194.
But where would the rest of the week take us? The answer on Wednesday was higher still, as we increased our standing to 1.8215. But with two days left to go could we keep up the good results or would we end up slipping back and giving the Aussie dollar the edge?
Thursday did bring us another increase, this time to 1.8275. And although we slipped a little on Friday we only dropped back to 1.8119 – although that still put the Aussie dollar ahead of us for the week. In total we had lost out on just under a cent for the week.
So it wasn’t a bad week for the British pound all in all – although it didn’t quite reach the heady heights of the week before.
Notable events in the world of currency
US dollar takes a nosedive against the Aussie dollar
It wasn’t all roses for the US dollar last week, as the Aussie dollar got the better of it. From a position of 1.1049 at the close of play on Monday, that slipped to 1.0923 by the time the week was out.
Euro does well against Swiss franc
After a closing figure of 1.5093 on Monday, the Euro managed to push that up marginally by the end of the week to 1.5115. Will there be better in store for next week too though?
Swiss franc loses some ground against the Canadian dollar
The figure was 1.0573 at the end of Monday and 1.0534 by the end of the week, so there was a small loss for the Swiss franc last week. Not too much though, so perhaps the Canadian dollar will have the balance redressed next time.
There was an interesting story regarding the South African rand on the Bloomberg website last week. You can read it here. It spoke of the slowing in foreign currency reserves, despite the fact that the rand has been performing exceptionally well recently.
So there we have it for another week. Will the pound do well again next time or will its performance start to slip? We’ll be here to find out, so we will see you then.