FX Update

USD broadly firmer, sterling bolstered by agreement expectations on Irish border.

 |  November 30, 2017

The greenback rally garners continued support from an uptick in US yields yesterday, President Trump’s nomination of Marvin Goodfriend to the Fed’s board of Governors, the potential for a Senate vote on US tax reform and improved US PCE deflator data today. Sterling also maintained a bid tone as a needed Brexit agreement in principle over the “hard boarder” issue between the Irish Republic and Northern Ireland may be at hand.

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  • FX Rates
    November 30, 2017

    Rates are not real time. Rates are today's indicative mid-market rates as of time of publishing, which may vary. Please contact SVB for a current quote.


  • USD

    Fed official John Williams stated overnight that the Federal Reserve wants rates to rise to the new normal of 2.5% over the next two years and said that 4 rate hikes between now and the end of 2018 makes sense.

    US Oct. PCE Deflator data out this morning was in line at 0.1% MoM and increased to 1.6% YoY, slightly better than surveys.  Initial Jobless Claims is released this afternoon while Dallas Fed President Kaplan is also due to hold a Q&A session at the Real Estate Council Speaking Series.


    Finding a solution to the Irish border that works for all parties seems to be the final hurdle before Brexit trade talks can begin next month. The UK, Dublin and Northern Ireland’s DUP are working to a deadline of Monday with the Irish government seeking a written commitment that makes sure regulations on each side of the border do not diverge significantly after Brexit.

    UK Nationwide House Price figures were released this morning slightly below expectations at 2.5%.


    ECB’s Klaas Knot said on Wednesday that the European Central Bank should wind down its stimulus program after September as it has reached its inflation goal, he has however been a strong critic of the scheme. 

    EU unemployment came out slightly better at 8.8% for October.  Estimates had been for a rate of 8.9%.  Despite the improvement the euro remains under pressure near 1.1850 and analysts focused more on missed CPI data for Nov., at 1.5% vs. 1.6% expected.


    The Canadian dollar remains under pressure despite a slight improvement to Q3 Canadian Current Account deficit reported at -$19.35b vs. surveys at -$20.0b.

    OPEC, Russia and non-OPEC producers agreed to an oil supply cut extension to the end of 2018.  The move is intended to support oil prices above $60. WTI remains below $58 and added selling pressure to the loonie.


    China reported better than expected manufacturing PMI data for November, 51.8 vs. 51.4.  Many economist had anticipated a slight decline.  Chinese shares fell while the yuan traded flat as the dollar retained its firm tone.

    In Japan equities fared better but the yen dipped as the dollar, supported by firmer treasury yields, continues to trade above 112.30.

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Source: Bloomberg 2017

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About the Author

John Schweizer is a product and foreign exchange advisor with Silicon Valley Bank’s Global Financial Services Group, based in Boston, MA. He works with SVB clients who conduct business globally and advises on the products, strategies and solutions used to manage international transactions and cash flows and mitigate the risk associated with currency fluctuations.

John has over 25 years of financial services experience in global treasury and foreign exchange, encompassing trading, sales and marketing, and product advisory. Prior to joining Silicon Valley Bank, he worked at several financial institutions including BankBoston, TD Bank and Fidelity Investments.

John holds a B.A. in International Affairs from The George Washington University and a M.S. in Multinational Commerce from Boston University.
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