Trans-Atlantic Exchange Rate Report for January 12th - 16th

By: Michael Horvath, The Quinnipiac University Global Economics Research Team

Trans-Atlantic 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.

From January 12^th – 16^th, the Trans-Atlantic currencies shared a common journey, which led to a common outcome. The Canadian dollar (red) displayed the least volatility as it showed subtle depreciation through the midweek, before end of week gains to close the week up 0.04%. The Swiss franc (maroon) had a sharp decrease to begin the week, where it then appreciated through the midweek, ending up 0.2%. The British pound (green) struggled into the midweek before ascending into the closing days to finish at an increased 0.13%. The euro (blue) declined through the 12^th, before surging over the back half of the week to concluded at a positive 0.22%.

Trans-Atlantic Historical Trends

 Source: Eurostat 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.

Through the week of January 12^th -16^th, all currencies varied in their direction and magnitude. The Canadian dollar (CAD) managed to create a subtle increase to avoid dropping below its 3-month average. The Swiss franc (CHF) continued its decent, now further below the three-month average in comparison to last week’s finish. The euro (EUR) shared a similar journey as it now rests below last week’s finish, as well as its three-month average. The British pound (GBP) displayed a surge that surpassed its upper bound, before falling below once again.

Additional Reading

Euro on track for third weekly loss in row

The euro has weakened against the U.S dollar for the third week in a row as strong U.S labor markets create a stronger demand for the dollar. Expectations rise that the European Central Bank may cut interest rates as inflation pressure ease. As the euro begins closing towards a six-week low, investors remain focused on future monetary policy outlooks.