Trans-Atlantic Exchange Rate Report For October 14th - 18th
By Lucas Messaggi, The Quinnipiac University Economics Research Team
Trans-Atlantic Currencies Index
Source: DBonomics 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 October 14th to October 19th, we tracked the performance of four Atlantic currencies and noted their exchange rate fluctuations. The Swiss franc (maroon) exhibited the most significant change, rising steadily by approximately 1.10%. Following closely was the Euro (blue), which also experienced a steady increase in its exchange rate, gaining around 0.80%. The British pound (green) encountered a downward spike around October 15th but quickly rebounded to finish the week with a modest increase of about 0.20%. Similarly, the Canadian dollar (red) experienced an upward spike on October 15th but ultimately declined slightly to end the week at approximately 0.18%.
Trans-Atlantic Historic Trends
Source: Dbonomics 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.
After incorporating this week's data into our historical graphs, several trends emerge. The Canadian dollar (red) continues to trend downward, remaining below the lower boundary of its three-month average, despite a small mid-week spike. Similarly, the Euro (blue) has fallen below its lower boundary, although it is showing an upward trend as it heads into the next week. The Swiss franc (maroon) has experienced a decline in its exchange rate over the past two weeks but has stabilized slightly just below its three-month average, with an upward trajectory expected in the coming week. The British pound (green) mirrors this behavior, remaining closer to its three-month average and exhibiting a smoother upward trend. We will continue to update these insights as more data becomes available in the upcoming weeks.
Additional Reading
The article discusses how the upcoming election has influenced demand for the U.S. dollar, particularly highlighting the potential ramifications for other currencies like the Canadian dollar (CAD), Euro (EUR), and British pound (GBP). If Trump were to win the election, shifts in tariff and trade relations could significantly alter the dynamics of these currencies against the U.S. dollar. A victory for Trump might lead to a reevaluation of trade agreements, which could strengthen the U.S. dollar in anticipation of more favorable trade conditions. This shift may negatively impact the CAD, as Canada relies heavily on trade with the U.S. Similarly, the EUR and GBP could face depreciation against the dollar if market confidence wavers in response to changing U.S. policies. The article underscores the interconnectedness of global currencies and the far-reaching implications of U.S. electoral outcomes on international trade and exchange rates.
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