Posted July 11, 2016
The US currency was bound to be affected by the UK referendum taking place this week. But would it be affected in a positive or a negative way? We’d soon find out.
If the US dollar wanted a great start, it certainly didn’t get it. Instead, it dipped from 0.6999 against the British pound today to reach a low of 0.6828 by the day’s end. What would happen from this point on though? The dollar began trading on 0.8885 against the euro, and didn’t do so well here either, finishing on 0.8824 today. Let’s go to a third currency in place in Europe, as the dollar went head-to-head against the Swiss franc. The starting rate was 0.9612 and this dropped to 0.9604 for the US dollar today.
More bad news for the dollar today as it dropped further to reach 0.6784 against the British pound. It did however achieve a slight improvement against the euro, reaching up to 0.8838 as a result. Would this be the way things would go for the rest of the week though? It somehow looked doubtful. Things weren’t as positive against the Swiss franc today, as it pushed the dollar back to 0.9589.
Finally, we had a small taste of some good news here, as the dollar perked up to hit 0.6806 against the pound. This was still lower than the opening rate had been back on Monday morning though. There was more of the same against the euro too, as the dollar rose to 0.8862 today. We did see the first improvement of the week against the Swiss franc though, as the American currency pushed ahead to achieve a closing exchange rate of 0.9598.
Another drop was in store for the dollar today, and the British pound really took it to task, too. It meant the dollar finished on 0.6725 as the referendum took place in the UK. More falls were in store elsewhere as well, not least against the euro, where the dollar dipped back to 0.8780 today. Perhaps we shouldn’t have been surprised about the big drop today that took the dollar back to 0.9549 against the Swiss franc. Where would it leave it tomorrow though, on the last day of this week?
As the result of the referendum became known, the markets clearly panicked. It meant the dollar was able to fight back in a big way, and ended up finishing on 0.7297 against the pound. It also did well against the euro, rising by 2.9% to hit 0.9036 today. Clearly, the euro was struggling as well. And the American dollar also managed to get in a good result against the Swiss franc today, rising to close on a week-long high of 0.9766. There would be much drama ahead, too, but the week did at least close on a high note for the US dollar.