The GBP has been one of the most talked about currencies fairly consistently for over a year now. Ever since the referendum that set Britain on a course towards Brexit in July last year, the pound has been one of the most volatile currencies, with plenty of major news like the invoking of article 50 and the election related chaos earlier this year to add excitement to the mix!
While in the past month we haven’t had anything as big as an election or any huge Brexit developments, there have still been some things that have significantly affected the pound against other currencies. Add to this that there have been reasons for these currencies to strengthen, and it has not been a good 30 days for the queen’s pound.
Where Was the Pound a Month Ago?
A month ago, the pound was stronger than it is now. It was at around 1.13 against the euro, worth around 147 Japanese yen, and 1.29 American dollars. How this compared with previous months is significantly different depending on which currency you are pitting the pound against; it was very weak against the euro compared with earlier peaks like in May when it exceeded 1.19, but in better shape against the yen which it had been as low as 126 against in November.
The pound has had a lot going on, but so have these other currencies, so how the pound has compared is always a result of what has been going on in those economies as well. Against the dollar, the pound has been faring fairly well of late when compared to the past year, so it was starting the month in what was, in post-Brexit terms, decent shape.
Where Is the Pound 30 Days On?
The pound is in worse shape against the euro and yen than it was a month ago, but doing slightly better against the dollar. Against the euro it has trended fairly steadily downwards all month aside from the odd jump, but the euro has been rallying against just about everything in recent weeks.
Against the yen, the pound has lost a lot of ground in the past 30 days, and recently hit a two month low. The yen is not an especially strong currency due to the approach of keeping its value low to promote export driven growth that has been employed fairly successfully by Prime Minister Shinzo Abe, however it has been performing well of late in forex terms.
The dollar has seen its own problems, and so the pound has actually had some moments of strength against it in the last few weeks, but even this pair has seen the pound slip recently.
What Is Affecting the Pound?
The reason the pound has gone down a lot lately is mainly to do with market reactions to the Bank of England deciding not to change interest rates. This was perceived as dovish and the pound dropped against other currencies as a result. The effects of this are still there, and mean that the pound is low against the euro and yen and not great against the dollar either.
Those interested in spread betting may well be watching to see if the pound can make a comeback from the BoE announcement slump, or whether there will be further bad news for the pound to come.