Trans-Atlantic Exchange Rate Report for June 8th – 12th

By: Matthew Natof, The Quinnipiac University Global Economics Research Team

Trans-Atlantic Currencies Index

 Source: Yahoo 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 June 8th-12th, all Trans-Atlantic currencies fluctuated and finished positively. The Canadian dollar (CAD) began at the lowest value among the currencies but ended at 0.76%. The Swiss franc (CHF) appreciated heavily, finishing at this week’s high of 1.09%. The euro (EUR) fluctuated for the majority of the week, ending at 0.63%. The pound (GBP) followed the euro but ended slightly lower at 0.48%.

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.

From June 8th-12th, three of the Trans-Atlantic currencies followed similar paths. The Canadian dollar (CAD), the outlier, depreciated for the week, ending well below its lower bound. The Swiss franc (CHF) appreciated this week, ending at its lower bound. The euro (EUR) followed suit, ending between its lower bound and its three-month average. The British pound (GBP) was at a similar level but ended above its three-month average.

Additional Reading

Canadian dollar hits seven-month low on wider yield spreads

This article explained that the Canadian dollar decreased because investors expected U.S. interest rates to remain higher than Canada’s. Weak Canadian economic data and uncertainty in oil prices also contributed to the lower price. As a result, more investors moved money into U.S. dollars, leading to a dip for the Canadian dollar.