Performance of GBP, EUR, USD & THB against each other since 2001

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Performance of GBP, EUR, USD & THB against each other since 2001

Post by JimboPSM » March 15, 2017, 3:37 am

I've produced some new charts showing the performance of GBP, EUR, USD & THB against each other since 2001

These charts were a by-product of verifying some other work that I have been doing on trade weighted indexed currency valuations.

In these charts I use annual averages as they remove a significant amount of “the noise” that daily (and even monthly) charts contain.

The annual averages have been converted into percentages to enable optimum comparability; they all use the annual average for 2001 as base 100% and all charts are scaled the same with an upper limit of 170% and a lower limit of 60% (it aids easy visual comparison).

They are, in descending order of performance:

1. The Thailand baht – THB
  • THBvsGBPUSDEUR.jpg
2. The Euro member countries – EUR
  • EURvsGBPUSDTHB.jpg
3. The U.S. dollar – USD
  • USDvsGBPEURTHB.jpg
4. The U.K. pound – GBP
  • GBPvsEURUSDTHB.jpg
NB: In the charts above the values for 2001 to 2016 are the averages for full years, the two right hand values are not. They represent values as as follows:

  • 2017 ytd – the average exchange rate for the year to date

    2017 now – the average rate for the date I last updated data for (14th March 2017).


At the top is the rather “surprising” result of just how well the THB has performed since 2001 (considering everything that has happened since then).

Although there are many contributing factors, there are three that I believe played a major part:
  • 1. The improvement includes a legacy element of recovery momentum from the 1997 crash.

    2. Thailand had relatively little exposure to the 2007/8 financial crash.

    3. It includes two periods where the THB was significantly overvalued (i.e. by over 10%).
    However, even after discounting those factors and with the THB still being overvalued today, the performance of the THB has nonetheless been impressive.
At the bottom the completely unsurprising result is how badly the GBP has performed, this stems essentially from three economically illiterate self-inflicted wounds:
  • 1. The decision not to join the EUR at its inception (in 1999).

    2. The inequitable austerity regime that restricted UK GDP growth post 2007/8 financial crash. (Note: GDP growth plays a major part in currency values).

    3. The Brexit referendum (when UK turkeys voted for Christmas) seriously restricts GDP growth prospects - in particular from exports and rapidly increasing domestic inflation.


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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by vidmaster » March 15, 2017, 12:22 pm

Get a life

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by parrot » March 15, 2017, 3:26 pm

vid, the joke thread is at
post480376.html#p480376


Thanks for the analysis and insight, Jimbo

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by randerson79 » March 15, 2017, 8:08 pm

Jimbo thank you for your posts. I find them very informative.

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Barney » March 15, 2017, 11:17 pm

vidmaster wrote:Get a life
Uncalled for Vidmaster.



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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by rick » March 16, 2017, 2:21 pm

1. The decision not to join the EUR at its inception (in 1999).

2. The inequitable austerity regime that restricted UK GDP growth post 2007/8 financial crash. (Note: GDP growth plays a major part in currency values).

3. The Brexit referendum (when UK turkeys voted for Christmas) seriously restricts GDP growth prospects - in particular from exports and rapidly increasing domestic inflation.
I would disagree with 1. The Euro crashed around the millenium by a third of it's value, so it's subsequent rise is not surprising - it has been in positive territory against all the other currencies for most of this period. As for 3 ...... yes, financially Brexit was a Turkey vote !

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by JimboPSM » March 16, 2017, 5:54 pm

rick wrote:
1. The decision not to join the EUR at its inception (in 1999).

2. The inequitable austerity regime that restricted UK GDP growth post 2007/8 financial crash. (Note: GDP growth plays a major part in currency values).

3. The Brexit referendum (when UK turkeys voted for Christmas) seriously restricts GDP growth prospects - in particular from exports and rapidly increasing domestic inflation.
I would disagree with 1. The Euro crashed around the millenium by a third of it's value, so it's subsequent rise is not surprising - it has been in positive territory against all the other currencies for most of this period. As for 3 ...... yes, financially Brexit was a Turkey vote !
I did do some work years ago looking at the early years of the Euro when I would agree that there were definitely some significant early stumbles; however, despite those stumbles, I concluded that UK citizens would still have been better off financially had the UK joined the Euro at its inception.

With regard to where we are today, I have absolutely no doubt that UK citizens would be considerably better off without that monumentally dumb Brexit referendum.

The EUR has done remarkably well (even with a series of self-inflicted wounds) especially when you consider the relentless attempts to sabotage both the EU (EEC at the time of joining) since the UK joined and the EUR since its inception.

The UK had also done remarkably well since it joined the EEC on 1st Jan 1973 when it was the sick man of Europe - a state of sickness that, very sadly, the UK Brexit referendum effectively voted to return to (anyone who has had the years of experience that I have had with exporting is more than well aware that outside of Europe it is extremely hard to find new markets that have customers that are actually credit worthy and countries that won't be seriously pissed at a UK that has an electorate that has declared itself to be racist and intolerant of foreigners).

The real impact on the GBP of the Brexit crash and its ever continuing decline is actually worse than it is portrayed as the percentage fall in the GBP is not the same as the percentage increase in cost it generates – there may be some who retain a memory of that quirk of percentages from their schooldays; this is it in chart form:
  • Real devaluation cost.jpg
Returning to the problems of the early days of the EUR; from my aging memory (as I can’t find it in the files on the laptop I have with me) some of the early problems I identified related to:
  • 1. Being new, everyone was on a learning curve.

    2. It was almost wholly an “electronic” currency when launched (before the days that internet banking started to really take off).

    3. There were no notes or coins until 1 January 2002 (although banks and businesses did rapidly learn to cope with using and converting legacy notes and coins)

    4. Geopolitical concerns:
    • a. From the UK not having joined.

      b. Denmark being in referendum limbo land.

      c. Parties that had (and still have) a vested interest in the failure of the Euro and the EU failing.
Anyway, rather than rely on my faulty memory, this is the extract on the launch of the Euro from the Wikipedia article on “History of the Euro”.
The currency was introduced in non-physical form (traveller's cheques, electronic transfers, banking, etc.) at midnight on 1 January 1999, when the national currencies of participating countries (the eurozone) ceased to exist independently in that their exchange rates were locked at fixed rates against each other, effectively making them mere non-decimal subdivisions of the euro. The euro thus became the successor to the European Currency Unit (ECU). The notes and coins for the old currencies, however, continued to be used as legal tender until new notes and coins were introduced on 1 January 2002 (having been distributed in small amounts in the previous December). Beginning on 1 January 1999, all bonds and other forms of government debt by eurozone nations were denominated in euros.

The value of the euro, which started at USD 1.1686 on 31 December 1998, rose during its first day of trading, Monday, 4 January 1999, closing at approximately USD 1.18. It was rapidly taken up and dealers were surprised by the speed at which it replaced the national currencies. Trading in the Deutsche Mark was expected to continue in parallel but vanished as soon as the markets opened. However, by the end of 1999 the euro had dropped to parity with the dollar leading to emergency action from the G7 to support the euro in 2001.

Later in 2000, Denmark held a referendum on whether to abandon their opt-out from the euro. The referendum resulted in a decision to retain the krone, and also set back plans for a referendum in the UK as a result. The procedure used to fix the irrevocable conversion rate of 340.750 between the Greek drachma and the euro was different, since the euro by then was already two years old. While the conversion rates for the initial eleven currencies were determined only hours before the euro was introduced as a virtual currency, the conversion rate for the Greek drachma was fixed several months beforehand, in Council Regulation 1478/2000 (EC), of 19 June 2000.

Full article: https://en.wikipedia.org/wiki/History_of_the_euro
This link to “The Telegraph” has an interactive graphic of the EUR/GBP rate from its launch to 2008, it clearly shows the stumbling of the Euro that Rick refers to at its start and then its recovery:
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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Galee » March 17, 2017, 6:56 am

http://www.express.co.uk/news/uk/780138 ... leaving-EU

Who's opinion do you respect more?

A bitter remainer or Prof David Blake?

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by trubrit » March 17, 2017, 7:18 am

Jimbo, ashamed to be English, very surprised to see you write that,(Are Manx men English anyway?) As an economist you are taking a very narrow view based purely on monetary concerns, but the referendum was about much more than that as you as an intelligent man must well know. Okay my pension is down about 23% right now due to the exchange rate, which is mainly caused by the money men's fear of losing out, not by the facts apparent in the market place . Look at Toyota's 250 million investment in the car industry, do you think they would have done that if they shared your pessimistic view? Personally whilst my pension devaluation has hit me hard it is a price I am prepared to pay to regain our sovereignty and dignity away from the dictators in Europe who want total, yes total control of all that, I as a British Englishman value so highly, even wanting the Royal Air Force, who I was so proud to be a member of to be part of a "European" military force. Sorry mate I signed to defend my Queen and Country from those who were our aggressors and now , not being able to achieve their ambitions by military means want to do so by the back door of politics .
Time will tell but my money is on a better Britain for the next generation, hopefully we can regain the support of our true friends in the Commonwealth, if it is not too late. They have stood with us through thick and thin and I am still ashamed how we dumped them in exchange for the Europeans who still in my lifetime , caused so much death and destruction in their attempts to control the world .
Proud to be British for ever.
Ageing is a privilige denied to many .

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Galee » March 17, 2017, 7:46 am

Nice post Trubrit. Couldn't have put it better myself. =D>

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Nigglyb » March 17, 2017, 11:23 pm

trubrit wrote: ......Proud to be British for ever.
Galee wrote:Nice post Trubrit. Couldn't have put it better myself. =D>
Ditto
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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by tamarlane » March 18, 2017, 1:41 am

welll ...i think Jimbo is moret right...trubit left out an importatt peace of the package...
"Johan van Zyl, president and chief executive of Toyota Motor Europe, said: “Continued tariff- and barrier-free market access between the UK and Europe that is predictable and uncomplicated will be vital for future success.”

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by arjay » March 18, 2017, 6:29 am

Truebrit wrote:but the referendum was about much more than that as you as an intelligent man must well know. Okay my pension is down about 23% right now due to the exchange rate, which is mainly caused by the money men's fear of losing out, not by the facts apparent in the market place . Look at Toyota's 250 million investment in the car industry, do you think they would have done that if they shared your pessimistic view? Personally whilst my pension devaluation has hit me hard it is a price I am prepared to pay to regain our sovereignty and dignity away from the dictators in Europe who want total, yes total control of all that, I as a British Englishman value so highly...
=D> =D> =D>

Well said, Trubrit. I couldn't agree more, particularly the part of your quote I have highlighted.

Yes, I would certainly like to have more baht per pound, but not at the cost of the loss of our country's sovereignty and democracy. The fall of the £ over recent decades, (well even since the Second World War) is a great shame. Though the fall resulting from the Brexit vote implications has only been over the last 9 months. I trust it will recover when the many implications of Brexit eventually get sorted out.

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by semperfiguy » March 18, 2017, 9:58 am

Has anyone noticed that the value of the USDollar against the Thai Baht has fallen by 40 satang over the past 3 days. That's a further loss of 400 Baht on a $1000 exchange. Is that due to the feds raising interest rates in the US by .25%, and can we predict further devaluation of the USD in the weeks ahead or will it recover?
"People sleep peaceably in their beds at night only because rough men stand ready to do violence on their behalf". - George Orwell

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by rick » March 18, 2017, 2:04 pm

Personally whilst my pension devaluation has hit me hard it is a price I am prepared to pay to regain our sovereignty and dignity away from the dictators in Europe
Although i understand where Truebrit is coming from, the EU has been good for us financially and it is hard to see how FINANCIALLY Brexit was a sane decision. Sure, the EU setup has problems but better to work from within, I think. Unfortunately the UK gave up manufacturing to concentrate on finance and services over the last 30 years, and certainly the financial sector will be badly hit.

Since Brexit, May quickly ran off to India to talk trade - and got nowhere. Next it was Trump and practically fawning upon him - not very dignified. As for the Commonwealth, they have moved on in the last 30 years and are no longer a captive colonial market. You cannot turn the clock back. Getting any of that trade back will be hard. Once the devaluation based inflation works it's way through, most of the temporary competitive advantage from the devaluation will be gone by 2020. If we get a bad deal from the EU, we can assume that exporting to the EU will decline and we can expect an ongoing balance of payments problem. Many maybe forget the mid 70's and the capital controls to prevent anyone taking their money out? If you did, read this -

http://www.telegraph.co.uk/finance/econ ... of-us.html

It could also spell the end of the United Kingdom. Scotland may go, and possibly Northern Ireland. Wales is a bit to small to make a go of it, but who knows?

I'm not trying to scaremonger, but there is a definite downside to Brexit while the upside is very much a dream which may not materialise. Empire is over. Get over it.

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by parrot » March 18, 2017, 3:35 pm

Might it be safe to assume that, just as the UK is looking out for its financial well-being post Brexit, the rest of the EU may be looking on how to capitalize on the exit of the UK. Since there appears to be no turning back, I'd think everyone would be trying to get the most out of the deal.....good, bad, or otherwise.

I'm not British, but it surprises me that folks from the UK can be so concerned about their own sovereignty after not being concerned about the sovereignty of other countries for several hundred years. Anyway, it would seem to me that the whole idea of the EU is to loosen up on individual country sovereignty concerns. I know some Texans who still find it hard to accept they're part of the bigger picture.......but seem to have no problem accepting (demanding) their share of federal assistance.

As for the Baht, despite all the empty buildings in Udon, a new monstrosity of a home improvement center on the ring road (after Global, Do Home, Home Pro, Home Mart, Tool Pro, Thai Watsadu, Homehub, and countless large mom and pop operations), and lots of darkness in all the condo operations at night, there are ongoing plans for even more subdivisions. Everyone thinks the burst is overdue, ........but if it's a wubble bubble http://wubbleball.com/ it could have a long way to go.

Nice weather sort of day to reflect on the world.......

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Galee » March 18, 2017, 4:32 pm

parrot wrote: I'm not British, but it surprises me that folks from the UK can be so concerned about their own sovereignty after not being concerned about the sovereignty of other countries for several hundred years.
As much as I would like a long life I think I should point out to you that I am not 200 years old.

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by Lone Star » March 18, 2017, 4:46 pm

trubrit wrote:Jimbo, ashamed to be English, very surprised to see you write that,(Are Manx men English anyway?) As an economist you are taking a very narrow view based purely on monetary concerns, but the referendum was about much more than that as you as an intelligent man must well know. Okay my pension is down about 23% right now due to the exchange rate, which is mainly caused by the money men's fear of losing out, not by the facts apparent in the market place . Look at Toyota's 250 million investment in the car industry, do you think they would have done that if they shared your pessimistic view? Personally whilst my pension devaluation has hit me hard it is a price I am prepared to pay to regain our sovereignty and dignity away from the dictators in Europe who want total, yes total control of all that, I as a British Englishman value so highly, even wanting the Royal Air Force, who I was so proud to be a member of to be part of a "European" military force. Sorry mate I signed to defend my Queen and Country from those who were our aggressors and now , not being able to achieve their ambitions by military means want to do so by the back door of politics .
Time will tell but my money is on a better Britain for the next generation, hopefully we can regain the support of our true friends in the Commonwealth, if it is not too late. They have stood with us through thick and thin and I am still ashamed how we dumped them in exchange for the Europeans who still in my lifetime , caused so much death and destruction in their attempts to control the world .
Proud to be British for ever.
I'm not British, and I believe citizens of countries should be free to decide whatever they wish; but I agree with this post wholeheartedly.

=D> =D> =D>
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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by parrot » March 18, 2017, 5:49 pm

Galee wrote:
parrot wrote: I'm not British, but it surprises me that folks from the UK can be so concerned about their own sovereignty after not being concerned about the sovereignty of other countries for several hundred years.
As much as I would like a long life I think I should point out to you that I am not 200 years old.
I guess I was thinking 1997, which seems like yesterday.

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Re: Performance of GBP, EUR, USD & THB against each other since 2001

Post by 747man » March 18, 2017, 6:10 pm

Jimbo, Ain't English if he's a Manxman, British Yeah but English Nah !!

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