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Monthly Update On Foreign Exchange Markets

foreign exchange markets

RegencyFX give their monthly update on developments in the foreign exchange markets together with an indication of expectations going forward. In August, we witnessed several notable events and developments that impacted the foreign currency market.

  • The US dollar strengthened against all major currencies in August as investors sought the safety of the US currency amid concerns about the global economic outlook. The dollar index, which measures the value of the dollar against a basket of six major currencies, rose by 1.5% in August.
  • The Euro weakens on concerns about the European economy. The euro weakened against the dollar in August as concerns about the European economy grew. The Eurozone economy is facing headwinds from a number of factors, including the war in Ukraine, rising energy prices, and the ongoing COVID-19 pandemic.
  • The yen weakens to a 20-year low against the dollar. The Japanese yen weakened to a 20-year low against the dollar in August as investors bet that the Bank of Japan (BoJ) will continue to pursue a loose monetary policy despite rising inflation. The yen is also being weighed down by the ongoing trade war between China and the United States.
  • The British pound strengthened on strong economic data. The British pound strengthened against the dollar in August, boosted by strong economic data from the UK. The UK economy grew by 0.5% in the second quarter, beating expectations. The pound is also benefiting from the Bank of England’s (BoE) plans to raise interest rates.
  • The Chinese yuan weakens on concerns about the property sector. The Chinese yuan weakened against the dollar in August as concerns about the country’s property sector grew. The property sector is a major driver of the Chinese economy, and its problems could have a knock-on effect on the rest of the economy.

Overall, the currency market was volatile in August as investors weighed the risks and opportunities presented by the global economic outlook. The US dollar remained the safe-haven currency of choice, but other currencies also saw some strength, depending on their individual economic and political circumstances.

Key factors that influenced the currency market in August:

  • The war in Ukraine The war in Ukraine weighed on the global economic outlook and led to safe-haven flows into the US dollar.
  • Rising inflation. Rising inflation in the United States and other major economies led to expectations of higher interest rates, which also supported the dollar.
  • The Chinese property sector Concerns about the Chinese property sector weighed on the yuan.
  • The UK economy Strong economic data from the UK boosted the pound.

The currency market is expected to remain volatile in the coming months as investors continue to assess the risks and opportunities presented by the global economic outlook.

Currency ranges in August


High: 1.1711 on August 9, 2023.

Low: 1.1579 on August 7, 2023.


High: 1.2760 on August 22, 2023.

Low: 1.2580 on August 29, 2023.


High: 1.9968 on August 19, 2023.

Low: 1.8020 on August 17, 2023.


High: 1.1004 on August 11, 2023.

Low: 1.0803 on August 29, 2023.

If you have any questions about international payments or would like a free, no-obligation quote, the team at Regency FX would love to hear from you.