Posted August 26, 2010
The US dollar is seen as the mightiest currency in the world. Many people look to it as a measure of what is going on financially, so it can be interesting to see how it fares against the Euro. This is after all the major currency in Europe, so to see these two big currencies going head to head can be fascinating.
We left the US dollar claiming 0.8149 Euros at the end of June, so the question was which direction it would head in from there onwards. It dropped to 0.7969 on the 2nd but then went back up to 0.8149 on the following day, so the first test was passed.
However things got more complicated from then on, as the dollar fell to 0.7969 the next day. It finished the week on 0.7957 too, so we were wondering whether this was a sign of something to come.
It certainly seemed to be because on the 14th it fell back to 0.7872, and there was worse news to come after that as well. The 15th saw a rate of 0.7795 on the cards and the week ended in even worse shape, as the dollar could only muster up a closing rate of 0.7692. The figure of 0.8149 we’d started with seemed to be a very long way away already, and we were still only halfway through the month.
There was some encouragement for the US dollar versus the Euro the following week however. As Monday came to a close the exchange rate on the currency converter came out to 0.7717. The dollar then built on this over the next two days and managed to successfully garner a rate of 0.7802 by Wednesday.
We didn’t expect to have to report on the dollar undoing that good work though, but in fact that is what happened. By the close of play that week, the dollar had slipped back once more to 0.7753.
Monday the 26th saw another small drop to 0.7733 and by now it seemed unlikely that the US dollar would be able to do well overall for the month. The opening exchange rate back on the 1st now seemed a very long way away indeed.
The figure dropped again on the 27th as the dollar fell back to 0.7672. Clearly the Euro was in charge here – the only question now was whether it could exert any more pressure before the month was out.
A last minute surge from the dollar produced an exchange rate of 0.7697 on the 28th, but this was about as good as things were going to get before the month was done. By the time the month of July had finished, the final exchange rate between these two currencies was 0.7675. The US dollar had a disappointing month and the Euro was clearly out in front at the moment at least.
We shall now be interested to see if the US dollar can regain any of these losses during August.