Pacific Exchange Rates Report for May 19th – 23rd

By: Mariam Saad, The Quinnipiac University Global Economics Research Team

Pacific Currencies Index

Source: Eurostat and own calculations. Exchange rates are inverted to be USD per local currency (i.e., an increase indicates a stronger domestic currency) and then indexed to be 100 at the start of the period.

For the week of May 19th – May 23rd, there were similar performances among the Australian Dollar (green) and the New Zealand Dollar (blue), with interesting performances from the South Korean Won (red) and the Japanese Yen (maroon). While all the currencies slowly decreased at the beginning of the week, they almost all fluctuated, with the exception of the Yen, which continued to decrease throughout the week. The Australian Dollar, New Zealand Dollar, and South Korean Won all followed a similar pattern alternating increasing and decreasing, with the Won being the lowest of the three by the end of the week. By weeks end, each currency was weaker than it was at the beginning of the week, with the Australian Dollar decreasing the least, by less than 0.5%, and the Yen decreasing the most, by over 2.0%.

Pacific Historical Trends

Source: Yahoo and own calculations. Exchange rates are inverted to be USD per local currency (i.e., an increase indicates a stronger domestic currency. The center line is a rolling three-month average. The upper and lower boundaries are the average plus and average minus one standard deviation, respectively, for the same three-month period.

For the week of May 19th – May 23rd, the Pacific currencies continued their recent monthly pattern, with the Australian Dollar (AUD) and the New Zealand Dollar (NZD) slowly fluctuating and the Japanese Yen (JPY) and the South Korean Won (KRW) with their more dramatic changes. The Yen had the worst performance this week, breaking its pattern of slowly increasing in the month of May. The Australian Dollar and New Zealand Dollar had the best performances this week, which reflects in their trends of slowly increasing. All the pacific currencies reversed their patterns from the previous week, with all of them decreasing.

Additional Reading

Japanese Yen Outlook: USD/JPY Sell Signals Strengthen as Risk Flares

The Japanese yen is gaining strength as investors look for safer assets due to renewed trade tensions and worries about the U.S. economy, arising from President Trump’s trade and tariff policies. The USD/JPY exchange rate is falling, and charts show that it is likely to fall more. Other factors like Tokyo inflation data and U.S. consumer spending could potentially move markets, but overall, risk concerns and bond market shifts are the main current drivers.