Headline for .     Since the beginning of 2018, despite the Covid-19 pandemic, currencies around the world are generally down against the United States dollar.     
World Currency Observer
World Currency Observer

Exchange Rates: one year high and low

December 1, 2022. Next update: December 14, 2022. Visit Search to look at past issues of World Currency Observer (brochure edition).

At the beginning of December 2022, changes in world interest rates continue to be the focus of currency movements, with the observation that the world interest rate focus is not just on policy actions by central banks (which frequently lag market movements, often a very sensible course of action), but also the recognition that interest rate movements reflect a variety of influences, including economic growth and inflation. Public statements, such as those from the United States central bank, are a reminder that all of these influences suggest that interest rates are, generally, still moving up, and the uneven pattern of these movements is an important influence on how exchange rates evolve. Currencies around the world (with a handful of exceptions, each of which are based on interesting particular circumstances), are generally below the pre-pandemic US$ values which they were at nearly three years ago, which translates into what is often termed the worldwide strength of the United States dollar. But, as is noted in the WCO monthly overview below, many currencies around the world moved up sharply in November 2022 – will this be the beginning of a trend, or will these movements be reversed in December 2022? As noted below, November 2022 was also a month in which the US$ prices of many commodities rose, after many months of decline. And, the widely-reported news on the China Covid-19-related lockdown reminds us that the impact of the pandemic continues to be felt around the world.

The Mexico peso was up by around 2.5% against the US$ in November, and is down by 2.5% from its level before the Covid 19 pandemic. The Costa Rica colón strengthened for a third month, moving up by 3.5% against the US$ in November 2022. The Haiti gourde fell by 10%. The Suriname dollar fell by nearly 7.5% against the US$ in November, and is down by 48% since this time last year. The Uruguay peso was up by more than 3% against the US$ in November (up by more than 10% since this time last year.) The Euro rose by 4.5% against the US$ in November (the Euro weakened in the first few days of the month, to US$.976 per 1 Euro on November 3, then strengthened throughout much of the rest of November, which included rising above the 1US$=1Euro value on November 8.) The Russia rouble rose by 1% against the US$ in November 2022. (Since before the invasion of Ukraine in February, the Russia rouble has shown a net strengthening of around 20% against the US$). During November, the Kyrgystan som was down by 2.5% against the US$, and the Uzbekistan som was up by 1%. After falling by more than 18% in October against the US$, the Egypt pound fell by a further 6.5% in November 2022, and is now down by more than 50% from its value in US$ terms before the pandemic. The Israel pound rose by 2.5% in value against the US$ in November (the Israel central bank interest rate was raised by 0.5% in the latter part of the month.) The South Africa rand was up by 7.5% against the US$ in November. Africa currencies which weakened, substantially, against the US$ in November 2022 were the Angola kwanza, the Zambia kwacha (down 5.5% in November, and down by more than 20% from its pre-pandemic level), the Gambia dalasi and the Ghana cedi (down by 3% against the US$ in November, and by nearly 150% from its pre-pandemic value of around 5.7 per 1US$ ). And, among the African countries with sharp increases in policy interest rates in the latter part of November were Ghana (up by 2.5%), Nigeria, South Africa and Kenya. A broad range of currencies in Asia moved up in November 2022 against the US$, but a majority of them are still well below their pre-pandemic level. Asia countries whose currencies are not far below their pre-pandemic level include Australia, China and Taiwan. It may be of interest to remark that the China yuan rose by 3% in November, despite the central bank announcements of a loosening of reserve requirements for banks in China in November, a move regarded as somewhat equivalent to a decline in interest rates, because it increases bank system liquidity, affecting prices and availability of loans. Among Asia currencies, the Malaysia ringgit and the Thailand baht rose by around 7.5% in US$ terms in November; the India rupee was up by around 1.5%. The U.S. dollar prices of most commodities around the world, in November 2022, were up against the US$, reversing some of the steady declines which we have observed since their March 2022 peaks. Exceptions to the November 2022 commodity price strengthening against the US$ included oil prices (up an average of 11%) and coffee (up 10%).

(World Currency Observer will next be updated on December 14, 2022. Visit Search to look at past issues of World Currency Observer (brochure edition). For permission-to-quote enquiries, e-mail World Currency Observer at WCO@briargreen.com.)