On the eve of the Rugby World Cup the big question in the currency markets is can the main currencies give us a guide as to who might win the Cup?
Looking across the main teams/currencies, we can see a strong correlation between winning on the field and a stronger currency.
The All Blacks have won the cup three times in 1987, 2011 and 2015. Interestingly, the first two wins were on home soil and led to large gains in the NZ Dollar, but their Victory in 2015 in the UK did not have the same effect.
Australia has won the Cup twice in 1991 and 1999 but both victories were in the UK and so the Australian Dollar fell in both instances.
South Africa has won the Cup twice, once at home which led to a stable currency – which is a positive for them, and then again in 2007 in France which was followed by a weaker Rand.
The English team only won back in 2003 which was in Australia and sparked a major rally in the Pound which rose 25% over the following four years.
The English Pound has staged a sharp rebound in recent weeks as Brexit fears subside – is this a sign that England can go on and win their second world Cup ?
The hosts, Japan, are always wanting a weaker currency so maybe they will throw a few games to help take the pressure off the Yen?
And the Argentinian Peso will need more than a Rugby World Cup to revive their currency.
France, Italy, Wales, Ireland and Scotland do not have their own currencies so this might be a factor in why they are yet to win the Cup?
Regardless of who wins we can guarantee there will be plenty of volatility both on the field and in the markets and we wish all the teams the best of luck.