Summary Of World Currency Markets For August 2010

Tuesday September 14, 2010

It’s time once again to focus on the results we saw on the currency markets during the previous month. This time we have August in our sights, to see how the various major currencies did on the currency converter.

Let’s see what happened and how.

An overview of the currency markets during August

When we last left the US dollar it was rated at 0.6408 against the British pound. When the new month got underway it started dropping almost immediately, reaching a month long low of 0.6265 on the 9th August.

Fortunately that meant it would go back up again afterwards, and by the end of that same week it was back to 0.6416. There were some ups and downs after this until the month came to an end, but eventually it closed on 0.6504.

But could the dollar do something similar against the Euro? Here we last left the dollar on 0.7675 after a poor month in July. We saw another dip here too, and once again the lowest rate was on the 9th, when the US dollar fell to 0.7545.

But things perked up after this. By the time August was over, the US dollar was on a much healthier looking 0.7886.

The US dollar finished July on 7.7663 against the Hong Kong dollar, so which way would things go now? Luckily for the US dollar things went well and it improved to 7.7715 on the 13th. In fact it only dropped back into the 7.76 region once more during the month, and only for a single day. August came to a close and the currency finished on 7.7802.

Finally let’s see how the dollar performed against the Japanese yen. We were starting from 86.444 in this case, but while there were peaks and troughs during the month the trend went steadily downwards. In the end the final rate for the month was 84.440.

Meanwhile, over in Europe…

We always take a look at the Euro and the British pound at this point. Last time the pound finished on 1.1977 so could it do better this time?

It hit an immediate high of 1.2106 on the 2nd before flagging again, but it managed to hit a month long high of 1.2247 on the 30th. The final day saw a slip to 1.2124 but this was still a good result for the pound.

Elsewhere last month…

Last time the Canadian dollar managed to grab a closing rate of 0.9683 against the US dollar for July. Unfortunately August would not be as promising for the Canadian dollar and by the end of the month it finished on 0.9400.

This was quite a loss for the Canadian currency, especially as it had managed to achieve a rate of 0.9869 very early on in the month. It obviously could not sustain the level it had set for itself, so it suffered the consequences instead.

Looking forward

It was certainly a strange month on the currency markets. The US dollar had some reasonable results against the Euro and the Hong Kong dollar, and yet elsewhere it was not as good.

We can always expect the rough with the smooth on the currency markets though, so perhaps this is to be expected. We did at least see some good results this month instead of a slew of all bad ones.

Needless to say we shall be watching closely to see whether the US dollar can start to build on the good results it got in August. Will the end of the year be good for the currency, or is this just a good blip in the middle?

It was also interesting to see the British pound managing to do better against the Euro during the month. The pound has been the subject of a lot of bad press lately. Many experts have said they think it will falter as the final third of the year gets underway. Only time will tell whether or not this is true, but it will be intriguing to see if they have got it right. They often do.

We shall be back next month with another global report. See you then.