Best and worst performing currencies in 2015

[tungfa]

Best and worst performing currencies in 2015

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The FX markets in 2015 have been defined by the De-Risking phenomenon: the markets have fled from risk into the main hard currencies, namely XBT(Bitcoin), USD, CHF and JPY. They have got the hell out of VEF, UAH, BRL, ZAR, COP, RUB. XAU (Gold) weakened somewhat, a signal that it is losing its safe haven status.

Top 5 strongest currencies in 2015
(Change against US $ at 12 December 2015)

Bitcoin (XBT) +21%
Israeli Shekel (ILS) +2%
US Dollar (USD)
Swiss Franc (CHF) -2%
Japanese Yen (JPY) - 2%
Bitcoin was also the world’s strongest currency in 2010, 2011, 2012 and 2013. (But in 2014 it was the world’s worst performing currency.) That is evident here.

Bottom 5 weakest currencies in 2015

(Change against US $ at 12 December 2015)

Venezuelan Bolivar (Black market rate) -78%
Ukrainian Hryvnia (UAH) -34%
Brazilian Real (BRL) -33%
South African Rand (ZAR) -31%
Colombian Peso (COP) -28%
Note that the money used in the world’s freest financial system — Bitcoin — has appreciated the most, and the money used in the world’s most Socialist and regulated economy — Venezuela — has lost the most value.

Data takes from Economist for 11 December 2015. Data for Argentinian Black Market rates from @DolarBlue on Twitter. Data for Black market Venezuelan Bolivar from www.dolartoday.com.

I have graphed the complete results. Venezuelan black market bolivar excluded from graph. Important currencies are in red.





Best and worst performing assets in 2015

There’s an argument to be made that Bitcoin is the top performing asset in 2015. Since 1 January it has increased from $314 to $431, i.e. by 37%. The Economist identified Hungarian equities as the best-performing asset of 2015, which increased by 34%.

Big Mac Index

Leaving Bitcoin aside, here is a quick update on The Economist’s Big Mac Index as it stands at December 2015 by my calculations. (It was last updated by The Economist in July 2015.)

Most under-valued currencies (cheapest Big Macs)

(Under-valuation against $)

Venezuela (black market rate 920 Bolivars/dollar) -97%
Ukraine -70%
Russia -68%
South Africa -66%
India -64%
A Big Mac bought in Venezuela with black market Bolivars costs the equivalent of $0.14.

The situation in Venezuela is crazy. There’s an interesting travel account here by The Broke Backpacker who describes his experiences buying money on the black market. And more here.

Most over-valued currencies (most expensive Big Macs)

Switzerland +37%
Norway +11%
Sweden +7%
Denmark +6%
US 0%