StanChart assesses a year in turmoil
People will remember 2011 as a year for mixed messages from the financial markets and challenging economic scenarios. The world saw some major activities ranging from the unprecedented credit downgrade of the United States to the debt crisis that had engulfed the eurozone, threatening to destroy the common currency itself.
The economic crisis has also translated to volatile commodity markets which defied most predictions made by market analysts, Standard Chartered Bank said in its global markets update.
A number of currencies dominated the news over the course of 2011, marking a year more volatile than the preceding years.
Dominating the news headlines for most of the year was the euro, a currency whose very survival has been debated more than once.
The euro started the year around the $1.33 mark, but it was only a matter of days before it collapsed to below $1.29 within the first half of January amid concerns of the debt crisis that has since dominated much of the news. It would recover from there however to spend much of the year above the critical $1.30 level, reaching a high of above $1.49 around the end of April or the beginning of May, although much of this would be short-lived, according to the market report.
The crisis surrounding a number of European nations (Greece and Italy) would cloud the currencies path for much of 2012, creating an environment of overall volatility that saw both gains and declines remain short-lived for the year. Now, as we have crossed over into 2012, we find EUR in a very similar position where it started last year; around 11 month lows were hit near the end of December as the common currency again fell to below the $1.29 mark, and managing to finish the year just above it but below $1.30.
Among the South Asian currencies, the taka was not alone in its spectacular depreciation against the dollar; the INR, which started the year below 45 against the greenback would go on to reach a high of over 54 over the course of 2011, eventually finishing around 53 for the year.
To be continued