2018 wrap-up


Investors did not have much to say on Friday. Year-end housekeeping was the order of the day and exchange rate ranges were narrow. The two sets of US data passed by almost unnoticed: pending home sales were down by 0.7% in November and the Chicago purchasing managers' index came in lower on the month but better than expected at 65.4.

The year ends with the USD an average of 5.9% above its levels at the beginning of January. Among the major currencies its biggest gain is of 10.0% against the AUD.


The week ended with Italy's coalition government finally putting to bed the 2019 budget which has been so contentious over the last three months. A 2.04% deficit is projected, which saves face both for Rome and Brussels. There remain doubts, however, about the future of the coalition itself, not surprising given that Lega's right-wing nationalism and 5Star's populist hand-outs are not natural bedfellows.

The EUR is 0.2% lower on the day against the USD and 5.1% down from its position at the beginning of January. On Tuesday the currency celebrates its 20th birthday. Over those two decades it has lost a net 3.0% to the USD - the sort of change that a major currency can experience on a single busy day.


On a day of modest movements there were no Canadian economic data to differentiate the CAD. It kept pace with a tightly-packed field and is unchanged against the USD.

For 2018 as a whole the CAD delivered a below-par performance, falling by an average of 2.4% against the other ten most actively-traded currencies. Against the USD it is down by 8.3% from its position at the beginning of January.


After an uneventful day on Friday the GBP popped higher as London opened this morning. The move was prompted by a comment from trade minister Liam Fox, who told a newspaper that the chances of Britain leaving the EU are only 50-50 if Parliament rejects the prime minister's withdrawal bill. GBP is 0.7% higher on the day.

In the year to date sterling has fallen by an average of 0.8% against the other major currencies. It is 6.7% lower against the USD.


The yen was roughly steady on Friday and it edged higher as Europe opened this morning for a daily gain of 0.2% over the USD. There was no domestic news or data to affect it.

In 2018 the JPY was the top performer among the major currencies, strengthening by an average of 7.5%. From its position at the beginning of January the JPY has moved 1.7% higher against the USD.

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