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October currency review

The drastic measures taken by Argentina's government and central bank in recent months to try to stop the dramatic slide in the value of the peso appear finally to have done the job, and the currency was the strongest in the world in October (see first table below).

Also bouncing back sharply were the Turkish lira, Brazilian real and Zambian kwacha, all of which had fallen heavily in recent months. Their recovery shows the value of not being too hasty in adjusting salaries of affected employees abroad when currencies suddenly decline and media headlines sound the alarm.

The other big climber this month was the Jamaican dollar, which benefitted from an improvement in economic indicators and forecasts, although it has also been volatile of late.

Countries experiencing largest currency gains in October
Country
Currency code Movement v EUR
1 Oct - 5 Nov 2018 (%)
Inflation
(%)
Argentina ARS +13 40.5
Brazil BRL +10 4.5
Jamaica JMD +7 4.3
Turkey TRY +11 25.2
Zambia ZMW +5 7.9

The Sudanese pound was by far the world's weakest currency in October following another major devaluation, which we detailed in a previous post.

Countries experiencing largest currency losses in October
Country
Currency code Movement v EUR
1 Oct - 5 Nov 2018 (%)
Inflation
(%)
Colombia COP -5 3.2
Costa Rica CRC -4 2.2
Iceland ISK -7 2.8
Mexico MXN -5 4.9
Pakistan PKR -6 5.1
Sudan SDG -62 68.6

In other currency news, Croatia's government has confirmed that the country will join the Eurozone's Exchange Rate Mechanism (ERMII) by 2020, effectively fixing the value of the kuna to the euro in advance of hopefully joining the single currency three years or so later.

Finally, here is this month's selected-currency-movements table:

Selected currency movements (v EUR)
Country Currency code % movement to 5 November 2018 v EUR since: Latest official annual inflation (%)
    1/10/18
(1 month)
30/7/18
(3 months)
30/4/18
(6 months)
6/11/17
(12 months)
 
Argentina ARS +13 -22 -34 -49 40.5
Australia AUD +2 0 +1 -4 1.9
Brazil BRL +10 +3 0 -10 4.5
Canada CAD +1 +2 +4 0 2.2
Chile CLP -2 -4 -7 -6 3.1
China CNY +1 +1 -3 -2 2.5
Egypt EGP +2 +2 +5 +1 16
India INR +2 -4 -3 -10 3.8
Indonesia IDR +1 -2 -2 -9 2.9
Japan JPY +2 0 +2 +3 1.2
Kenya KES +1 +1 +5 +4 5.7
Korea Republic KRW +1 +2 +2 +2 1.9
Mexico MXN -5 -5 -1 -3 4.9
Nigeria NGN +2 +2 +5 +1 11.7
Norway NOK -1 0 +1 0 3.4
Philippines PHP +3 +2 +3 -2 6.6
Poland PLN -1 -1 -2 -2 1.9
Russia RUB +1 -3 +1 -10 3.4
Singapore SGD +1 +1 +2 +1 0.7
South Africa ZAR 0 -6 -9 0 4.9
Sweden SEK 0 0 +2 -5 2.3
Switzerland CHF -1 +1 +5 +2 1
Turkey TRY +11 -1 -18 -27 24.5
United Kingdom GBP +1 +1 0 +1 2.4
United States of America USD +2 +2 +6 +2 2.3
Venezuela VES -3 -96 -99 -99 488865
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