Summary Of World Currency Markets For May 2010

Tuesday June 8, 2010

Welcome back to another world currency report, which this time focuses on the month of May 2010.  This proved to be an interesting month, with the General Election taking place in the UK and worries over the state of the Euro taking place elsewhere.

The US dollar didn’t do too well against the British pound during April, as it lost out on around half a cent.  It did better against the Euro though, adding on around a cent in all.  There was very little difference against the Hong Kong dollar but things were looking up against the Japanese dollar, so it wasn’t all bad.

The question is how the US dollar did during May, as time clicked on and several other currencies went through a period of uncertainty.  Would the US dollar feel the strain during May as well?  Let’s find out right now.

An overview of the currency markets during May

Let’s take a look at how things went for the US dollar against the British pound first of all, as we start from an exchange rate of 0.6536.  As it turned out the first week proved to be a pretty good one for the dollar, as it powered up to a rate of 0.6810 by the 7th May.

There were some marginal dips after that, but the dollar pushed back and even managed to achieve a rate of 0.7008 by the 20th.  It couldn’t hang on to this though, and by the following day it had dropped back to 0.6964.

At the end of the month the US dollar found itself on an exchange rate of 0.6895, so all in all it had still had a good month.  It had added on a total of over three and a half cents, so it was certainly in a strong position as June got underway.

Elsewhere the US dollar did well against the struggling Euro as well.  From a starting point of 0.7510 it gradually climbed higher through that first week, much as it had done against the British pound.  The closing rate for the week was 0.7845.

By the same time the following week it had achieved a rate of 0.8005, but could it hold onto that level throughout the rest of the month?  It may have seemed to be too much to ask for, but the high point of the following week ended up being 0.8149, and it did not dip below the 0.80 mark for the rest of the week either.

In fact the US dollar managed to stay above that mark and closed out the month on an impressive 0.8125.  This meant the dollar had increased its value by an amazing six cents against the Euro.

Our next stop is the Hong Kong dollar, where the US dollar was worth 7.7631 at the end of April.  Once again the US dollar steadily increased its value against this currency throughout the month, achieving a high point of 7.8056 at one point.  Unfortunately this wasn’t on the last day of the month, when the rate had changed to 7.7927.  This was still an appreciable increase of 0.0296 over the whole month though.

Finally let’s move on to the Japanese yen.  The closing rate for April was 94.487 but unfortunately for the US dollar the highest rate of the month was achieved on the 5th – a rate of 94.908.

From there onwards the rate started to go in favor of the yen rather than the US dollar, and on the 21st it went down to 89.685.  The US dollar did manage to improve its standing again after that and it finished the month on 91.508.  This still meant it had lost out on 2.979 over the month as a whole though, so it wasn’t the best time it could have been for the dollar.

Meanwhile, over in Europe…

As always we take a look at the situation between the British pound and the Euro here.  The starting rate this time around was 1.1490 for the pound versus the Euro, and by the 6th of the month the pound had climbed to an impressive 1.1863.  Unfortunately it couldn’t hang onto that figure and it finished the week on 1.1520 instead.

After that things started to get better for the pound again though, and the following week saw a high point of 1.1773.  Clearly the Euro was struggling to maintain any kind of authority over the pound, and even though the General Election had by now taken place, things were still unsteady in both camps.

The week ending the 21st May ended on 1.1489 for the pound, which didn’t look good at all.  But fortunately things started to get better and the currency finally finished off worth 1.1783 against the Euro.  This meant it had added on nearly three Euro cents over the course of the month, which was definitely a good result and one to be proud of.  But will it be one that will be built on even further in June?

Elsewhere last month…

Last time we saw that the Canadian dollar did better than the US dollar, keeping the level firmly in its favor for the month.  But would this continue during May as well?

The starting rate of 1.0048 changed to a much higher 1.0802 by the time the 25th May rolled around, but by the end of the month the exchange rate had fallen back down to 1.0476.  The US dollar had therefore done well during the month, adding on a total of over four cents and moving away from parity as well.

Looking forward

It has certainly been an interesting month to look back on for the US dollar.  It has achieved some reasonable results in some areas and a couple of really significant ones as well.  If we return next month however, will we find the same kind of results as we have this time?

There is only one way we can find out, so we shall see you here then with another look at the figures we have found on our currency converter.