Pacific Exchange Rates Report for November 6 – 10

By: The Quinnipiac University Economics Research Team, Dan Hogan

Pacific Currencies Index

Source: Yahoo Finance 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 November 6 – 10th, all currencies posted early gains, only to weaken for the rest of the week. The Australian dollar (green) gained more than a whole percent against the USD, only to weaken for four straight days, closing on November 10th down 1% from the very start of the week. The New Zealand Dollar (blue) was no exception, gaining nearly 2% by end of day Monday, and proceeded to devalue against the USD by about 0.5% each day until end of day on November 10th, finishing just below its initial value. South Korea’s won (red) saw more success this week, strengthening about 1.5% against the USD by end of week after peaking at nearly a 3% gain. To close out the region, the Japanese yen (maroon) showed little signs of fluctuation, weaking about 0.5% against the USD for the week.

Pacific Historical Trends

Source: Yahoo Finance 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.

Throughout the past week of November 6 – 10th, there were significant movements throughout the Pacific region currencies. Two currencies, the Australian dollar (AUD) and South Korean won (KRW) surpassed their upper bounds for the first times in months. While the KRW remained above this bound, the AUD dropped back to where it started, hovering near the lower bound. The strengthening of the New Zealand dollar (NZD) temporarily brought it above the rolling three-month average; it settled between the lower bound the rolling average. While all other currencies continue to fluctuate, the Japanese yen (JPY) weakened, falling below the lower standard deviation, but continuing to remain fairly consistent. After the large early week rally for NZD, AUD and KRW, any notion of a trend for these currencies have been dissolved, as some erased months of losses in only a few days.

Additional Reading:

AUD / USD:

The article by FXStreet gives more insight into the depreciation of the AUD / USD this past week.