Currency exchange rates are very sensitive to world and political events as well as supply and demand. It’s fair to say that the Coronavirus pandemic event is unprecedented in modern times and retail demand for currency has reached it’s lowest point for many years quite simply because people across the world can’t travel.
In the UK many high street bureau de change, including the biggest brand names, have closed their doors. However, you can still buy currency online for home delivery with a number of independent suppliers and this has kept the rates competitive as demand is low.
Want to know when exchange rates get better?
We take a look at some popular currency exchange rates over the last 2 months since lockdown began, these are not the interbank exchange rates but are representative of the retail exchange rates you could find if you were buying currency.
The euro has rallied well over the last 8 weeks. On March 20th it hit a low of 1.103, although that’s nowhere near it’s lowest point over the last year which was reached in August 2019 at 1.065. This low was mainly to do with Brexit – remember that! Since the end of March the euro rate has rallied and peaked on April 15th at 1.161 and steadied to around 1.135 for a while. Rates dipped again from May 13th and are currently around 1.12. Ironically, the current rate is very similar to the rate on offer the same time last year. Overall the euro is slightly down by around 1.4% over the last 60 days.
US Dollar (USD)
Similarly, the USD hit a low of 1.212 when lockdown was introduced and rallied to peak recently at around 1.26. Like the euro, the low in March was still not as low as last August and the current rates are very similar to what you would have found during early summer 2019, currently around 1.23. Overall, over the last 2 months the USD is only down by 0.46%.
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Currencies that have improved the most during lockdown
Some currencies have improved over the lockdown period but there is no sure way of knowing why any particular currency is doing better than another at the moment. We would love to be able to tell you!
Morrocan dirham (MAD) held steady since March 20th at around 11.00 but saw a nice rise in exchange rates on May24th and is up around 13% at the moment on its rate 30 days ago.
Jamaican dollar (JMD) rates have improved by around 10% over the last 2 months and Turkish lira (TRY) rates have improved by 7.5% to around 8.35 but have dropped back slightly from a peak in May of 8.88. Some South American currencies have seen gains of over 5% over the last 60 days but some, such as the Argentine Peso, have few suppliers so the rates are not always competitive enough for a true comparison.
Currencies that have fared the worst
A few currencies have not done as well and again there is no particular reason that we know of for any of them.
Ukrainian hryvnia (UAH) has seen the largest loss over the last 60 days, down around 16%. It saw good rate in the middle part of May but has now dropped to it’s lowest rate so far this year at the time of writing was 26.2.
The Russian ruble (RUB) was enjoying very good rates from the beginning of March. In fact the rates were as good for RUB as they have been at least for the last 3 years. However, since May 11th the rate has dropped and at 86.5 the value is 10% less than 2 months ago. Again, even this lower rate is better than at anytime during 2019.
Other currencies that have seen a 5% drop since the end of March include Indonesian rupiahs (IDR) at -5.73% and Colombian pesos (COP) at -5.13%
This as usual, is an unknown quantity. With lockdown restrictions being eased across the globe and demand picking up for currencies we would expect to see rates improving, especially for countries that are accepting visitors once again. However, until the Foreign and Commonwealth Office change the blanket advice not to travel internationally for leisure, then not much is likely to happen to rates from UK suppliers. Visit the website for live, up to the minute, exchange rates for over 60 currencies.
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