Pound Falls to All-Time Low vs. Euro

Discussion in 'Current Events' started by Unspeaked, Nov 12, 2008.

  1. macrumors 68020

    Unspeaked

    #1
    LINK

    I meant to post this the other day, but on Monday, the British Pound fell to an all-time low vs. the Euro...

    (By the way, it's actually higher now than what's quoted in the article - a euro is .83 pounds!)

     
  2. macrumors 601

    Schtumple

    #2
    Wow, hard times are indeed ahead. I always admired how strong the pound was against other currency..
     
  3. macrumors P6

    IJ Reilly

    #3
    You mean, for about six months?
     
  4. macrumors 601

    Schtumple

    #4
    I meant against the dollar and euro.
     
  5. macrumors P6

    IJ Reilly

    #5
    Right, for about six months. That's about the full extent of the time it was trading at much of a premium against the dollar and the euro. Maybe a year.
     
  6. macrumors 601

    Schtumple

    #6
    Ok, cba to argue.
     
  7. macrumors G4

    Rodimus Prime

    #7
    that is a really bad sign because the Euro is falling like a rock against the dollar right now as well.
     
  8. macrumors P6

    IJ Reilly

    #8
    A bad sign for whom? I'd been contemplating a trip to the UK next year, but the value of the dollar was holding me back. Looks like we may be going after all.
     
  9. macrumors G4

    Rodimus Prime

    #9
    true. Good sign for the US traveler bad sign for England.

    I was reading really the huge boost in the dollar and the yen is because those 2 currency are consider the "safe" currency in economic hard times.
     
  10. macrumors P6

    IJ Reilly

    #10
    I'd think the euro would also hold up pretty well in bad times.

    And before some of our British friends mention it, the pound sterling is the currency of the entire UK, not just England. ;)
     
  11. macrumors 6502

    #11
    I don't think it's that bad news for the UK given the current situation. A weaker £ means exports are more competitive so that gives UK exporters a boost. Import prices are up but inflationary pressures aren't exactly huge at the moment!

    I've always thought the € was undervalued in the past as it's a young currency so has had to build up a reputation. The £ was probably overvalued as well so although it was nice for Brits travelling abroad, it wasn't really a long term position.
     
  12. macrumors Core

    Dagless

    #12
    My gramps is off to Germany tomorrow, booked it last minute so the flight was quite expensive and the conversion rate leaves him with less holiday funds. Unlucky, I spose!
     
  13. macrumors G4

    Rodimus Prime

    #13
    you should look at the Euro vs the Dollar. This summer the 1 Euro was worth over $1.60. Now today it the 1 Euro is worth $1.25 and falling.

    And think this summer everyone was think the dollar was worthless and now it is flying up in strength compared to all other currency other than the yen.
     
  14. macrumors 68020

    Unspeaked

    #14
    I don't know about that.

    I consider anything over $1.70 - certainly over $1.75 - to be a pretty good premium (traditionally, the dollar was around the $1.50 level we're at today versus the pound) and if you look at this chart, you'll see it's been in "premium" territory since 2004:

    [​IMG]


    And here's the 5 year chart of the pound versus the euro, which looks even more extreme:

    [​IMG]

    And neither of these charts adequately represent the recent days falls to levels of $1.48 and $1.18 respectively...
     
  15. macrumors P6

    IJ Reilly

    #15
    Not me. When I heard all the griping from folks abroad claiming that they were being "ripped off" by Apple's pricing entirely on the basis of their soaring currencies, I'd always suggest, wait a few months, this may well change (and it has). So taking a bit more of an historical perspective, it wasn't so long ago that the euro was worth less than one US dollar. For the time being, it's come down from historical highs against the dollar. That's about all we can say. Next week, who knows?

    I'm familiar with these charts. I don't know the average, but the pound has traded mainly in the $1.50-1.70 range for many years, with occasional ventures above and below. Certainly $1.70-1.80 isn't much out of that range, but when it traded above $1.90 for an extended period, that was a real premium by recent standards. Though the recent plummet is dramatic, it's too soon to say that some sort of fundamental currency revaluation is occurring. Probably not.
     
  16. macrumors 68020

    Unspeaked

    #16
    All I'm saying is that after a brief flirtation with the $2 level in the late 80s, the pound settled down in the early 90s and never even approached the $1.75 until 2004. Since the, it didn't fall below that level until just now.

    Yes, we don't know where it will go from here, but it looks increasingly like we just experienced a 4 year spike.
     
  17. macrumors 6502

    #17
    I am less likely to buy anything right now from the US and before i did use to import stuff over. It is just not worth it anymore and other people are saying the same as well.
    I would also consider putting of travelling there as well if i wanted to go on holiday somewhere. Less people are likely to travel to the US now from abroad.
     
  18. macrumors 6502

    #18
    I think fewer people are likely to travel full stop over the coming months!
     
  19. macrumors P6

    IJ Reilly

    #19
    Sure it did. When I was living over there for several months during the early '90s the exchange rate was in the $1.65-75 range the entire time. I can't find any charts going back that far, but it was so. In all the trips I've made to Britain over the years (since the early '70s), I can recall only one time when the exchange rate was more favorable than $1.50.
     
  20. macrumors 68020

    Unspeaked

    #20
    This page has a chart going pretty far back:


    [​IMG]

    I don't see how someone could look at that and not think there's a distinct spike starting in 2004 and ending the past month or so...

    (Or, if nothing else, a 10-year lull between 1994 and 2004)
     
  21. macrumors 601

    Diatribe

    #21
    It is actually pretty good because Europe's exports have been suffering a lot with the exchange rates this year. This is good for the European economy, not bad.
     
  22. macrumors P6

    IJ Reilly

    #22
    Good chart, thanks for finding it. You can see the "spike" in 2004-07 repeating a similar pattern in 1990-93.

    We're probably not going to settle this one way or another, but clearly this is a big and dramatic move down for the GBP, but also pretty clearly, as the chart shows, these things do pass. All this really means is that a nice window of opportunity has opened up for Americans visiting Britain, a window that wasn't open just a few months ago, and might not be open a few months from now.
     
  23. macrumors 68020

    Unspeaked

    #23
    Yeah, like you mentioned yourself, I've been looking more into taking a trip over there, and I'd imagine many mainland Europeans are, too, with the euro's improved exchange rate, so it's got to be good for tourism.

    I just wish the flights weren't so expensive!

    Another interesting thing about that chart - look at 1985, the first and only time the dollar and pound approached parity (in fact, I remember reading once that the two currencies actually did reach parity in the middle of the day at one point in time during that period).
     
  24. macrumors P6

    IJ Reilly

    #24
    We made one trip over there when the GBP was around $1.30 or something like that during the mid-'80s. That was also the days when a respectable B&B could be had for £8 per person. I remember during that short period when the pound came close to $1.00, Americans on the East Coast were flying over to London for weekend shopping trips. Didn't last -- these things never do!
     
  25. macrumors 6502a

    yorkshire

    #25
    Sorry if it's a bit irrelevent, but why do people actually want to come to England? I'm all for tourism to help the economy, but, as a Brit myself, I wouldn't know why people would want to come here on holiday! Unless your going to London or something to see the sites I suppose. One tip if you do come here though-watch a Premier League game, the Premier League is the best League in the world and the atmosphere is incredible. If you can try to see Liverpool, Chelsea, Arsenal or Man U. It will be money well spent!

    Wow I do drift off topic don't I??!?:D
     

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