Skip to Content
SVB
Silicon Valley Bank
SVB Private
SVB Securities
SVB Capital
Region:
 
First Citizens Bank acquires Silicon Valley Bridge Bank, N.A..  Learn more here
  For a better web experience - please upgrade your browser to Google Chrome  
 
Silicon Valley Bank
Products & Services
Business Banking

Complete your banking transactions with ease and security.

  • Business Checking
  • Payments & Business Credit Cards
  • Online Tools & Integration
  • Fraud Prevention
  • Lending
Global Business Solutions

Get customized services to help support your global business.

  • Global Banking Services
  • Global Payments
  • Foreign Exchange Risk Services
Liquidity Solutions

Strategize with our financial experts to help you achieve your business goals.

  • SVB Asset Management
  • Deposits & Investments
Global Fund Banking
Leverage SVB's 30+ years experience in banking top funds.
  • PE Fund Banking
  • VC Fund Banking
Our Expertise
Our Business Expertise
  • Business Stages
  • Startup Banking
  • Venture-Funded
  • Corporate Banking
  • Investors
  • Private Equity
  • Venture Capital
  • Emerging Managers
  • Corporate Venture
Industry Expertise

Our bankers have years of real-world experience to provide guidance across a number of industries.

View All Industries
Case Studies
  • Our Sector Knowledge
  • Cleantech and Sustainability
  • Consumer Internet
  • Enterprise Software
  • Fintech
  • Hardware & Frontier Tech
  • Investors
  • Life Science and Healthcare
  • Premium Wine Banking
Trends & Insights
Trends & Insights

SVB research, blogs and webinars to give your business crucial advantages in decision-making.

Reports Global Fund Banking Outlook Healthcare Investments and Exits Future of Climate Tech State of the Markets State of Consumer Internet State of the Wine Industry State of Fintech Family Office View All Reports
Perspectives and Insights Foreign Exchange Advisory Business Growth Market Insights Industry Insights Private Bank Startup Insights Private Equity CFO Insights View All Insights
SVB Webinars

Register for upcoming live webinars and access recorded webinars to learn about the latest trends for your business and industry.

View Webinars
About Us
SVB Facts

For over 35 years, SVB has helped businesses grow and thrive across the innovation economy

Living Our Values

SVB's values guide our actions, from our approach to supporting small businesses to community engagement to our ESG reporting.

Contact Us

Let SVB experts help your business with the right mix of products, services and strategic advice.

Resources
  • Locations
  • Leadership
  • Newsroom
  • Investor Relations
  • Client Support
  • Careers
  • Success Stories
  • Access to Innovation
Investor News: SVB Financial Group Announces 2022 Fourth Quarter Financial Results Learn more  
Become a client
Login
SELECT A SERVICE FOR LOGIN
SVB Online Services
SVB Online Services SVB Go Private Bank Private Banking – Legacy SVB Private Banking – Legacy Boston Private Investments SVB Capital Limited Partners SVB Asset Management Reporting U.S. Bank Pivot Credit Cards Cardholders Administrators
  • Need help? Client Support
Search SVB
Products & Services Our Expertise Trends & Insights About Us Careers
Login
Products & Services
Business Banking
Business Checking Payments & Business Credit Cards Online Tools & Integration Fraud Prevention Lending
Global Business Solutions
Global Banking Services Global Payments Foreign Exchange Risk Services
Liquidity Solutions
SVB Asset Management Deposits & Investments
Global Fund Banking
PE Fund Banking VC Fund Banking
Our Expertise
Our Business Expertise
Business Stages Startup Banking Venture-Funded Corporate Banking Investors Private Equity Venture Capital Emerging Managers Corporate Venture
Industry Expertise
Cleantech and Sustainability Consumer Internet Enterprise Software Fintech Hardware & Frontier Tech Investors Life Science and Healthcare Premium Wine Banking
Trends & Insights
Reports
Global Fund Banking Outlook Healthcare Investments and Exits Future of Climate Tech State of the Markets State of Consumer Internet State of the Wine Industry State of Fintech Family Office View All Reports
Perspectives and Insights
Foreign Exchange Advisory Business Growth Market Insights Industry Insights Private Bank Startup Insights Private Equity CFO Insights View All Insights
SVB Webinars

Register for upcoming live webinars and access recorded webinars to learn about the latest trends for your business and industry.

View Webinars
About Us
SVB Facts
Living Our Values
Contact Us
Resources
Locations Leadership Newsroom Investor Relations Client Support Careers Success Stories Access to Innovation
Select a Service for Login
SVB Online Services SVB Go Private Bank Private Banking – Legacy SVB Private Banking – Legacy Boston Private Investments SVB Capital Limited Partners SVB Asset Management Reporting U.S. Bank Pivot Credit Cards Cardholders Administrators
Close
  • Select a Region
    • North America
      • US Main
        Canada (EN)
        Canada (FR)
    • Europe and Middle East
      • Israel (EN)
        United Kingdom
        Denmark
        Sweden
        Germany (DE)
        Germany (EN)
    • Asia
      • China (中文)
        China (EN)
Find anything about our product, search our documentation, and more. Enter a query in the search input above, and results will be displayed as you type.
Searching... Loading content
    Searching... Loading content
    People
    • Foreign Exchange Advisory
    • FX Update

    Dollar dropped despite hawkish Fed and economic data. Inflation hit new peaks in UK, Eurozone, and Canada.

    Kathy Sun Headshot
    Kathy Sun
    • October 24, 2022
    • Strong corporate earnings briefly boosted stocks in the US last week. Markets were able to focus on actual earnings power over the economic data. Still, equity valuation remains linked to rate decisions of central banks and risk sentiments.
    • Commodity currencies including CAD, AUD, and NZD outperformed as oil prices rose last week given tightening supply and uncertain demand. This was slightly mitigated by the news that the US would release more crude oil from the Strategic Petroleum Reserves.
    • This week, markets are unlikely to see signs of a Fed pivot. A forecast on initial jobless claims expects a tight labor market, and a forecast on GDP suggests the US economy can handle a jumbo rate hike.    

    Data/Events Calendar Oct 24 – 28

    Tuesday: US Consumer Confidence

    Wednesday: Bank of Canada Interest Rate Decision

    Thursday: ECB Interest Rate Decision; US GDP Growth Rate QoQ, Jobless Claims

    The breakeven rate on inflation-protected bonds can be viewed as a reliable measure of inflation expectations for longer horizons than those measured by surveys. Current readings (see table at the bottom) show inflation is expected to cool towards central bank targets, which may be more a reflection of pessimism on future global economic growth.

    • FX Rates
      Last Week's Range

      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.

      EUR/USD0.97-0.99
      GBP/USD1.11-1.14
      USD/CAD1.36-1.39
      AUD/USD0.62-0.64
      USD/JPY146.2-152
      USD/CNH7.19-7.28
      USD/ILS3.51-3.58
      USD/MXN19.9-20.2
      USD/CHF0.99-1.01
      USD/INR82-83.3
      USD/BRL5.14-5.3
      USD/SGD1.42-1.43
      USD/DKK7.53-7.66
      USD/SEK11-11.4
      USD/NOK10.5-10.7

    • USD

      Market Bias: Hawkish

      • Industrial Production in September came in better than expected, hitting a new record high and providing relief to the economic slowdown.
      • Worse-than-expected data from the US housing market is attributed to high mortgage rates. Housing starts dropped 8% to 1.4m. The mortgage application index fell 4.5% last week. 
      • The Fed meeting minutes indicated “inflation was declining more slowly than they had previously been anticipating” and the markets have entirely priced in a fourth consecutive 75-bps hike at the next Fed meeting in November. The terminal rate is projected to be 4.9%. 
      • Risk to current market bias: Continued weakness in housing and labor markets will weigh on the risk of recession and result in a less hawkish Fed.
      GBP

      Market Bias: Bearish

      • The UK reported a higher-than-expected CPI, indicating inflation is not slowing down.
      • Ongoing political volatility continued. Liz Truss announced her resignation as Prime Minister following seriously adverse reactions from financial markets. A leadership election will be completed within this week. The new chancellor is expected to outline steps to support the country’s fiscal sustainability after the policy U-turn. A lack of fiscal policy could further jeopardize economic growth.
      • The BOE confirmed that it would begin its tightening program and sell gilts on 1 Nov to refocus on the inflation fight. Long-term bonds are excluded initially. 
      • Risk to current market bias: Market perceives positive impacts from the changes, and GBP recovers from current depressed levels.
      EUR

      Market Bias: Bearish

      • EU inflation rose to 10% in September, implying that the ECB, the central bank the governs the European Union, will need to be hawkish and deliver a 75-bps rate hike this week as expected.
      • Investors remained bearish on the eurozone’s long-term outlook despite gas prices dropping.
      • Risk to current market bias: The European Commission proposed €40 billion in aid to help businesses and households as part of the energy package. EU member states have tagged €500 billion to cushion the impact of the energy crisis. The Cohesion Fund would also be used to support labor markets. Plus, positive news on energy supplies could provide a temporary lift on EUR.
      CAD

      Market Bias: Bearish

      • Markets anticipate the Bank of Canada (BoC) to increase the interest rate by 50bp after implementing a 75bp rate hike previously. However, the Federal Reserve is expected to raise rates by 0.75% at both its November and December meetings. 
      • The BoC is expected to bring an earlier end to its rate hike cycle to reduce the recession risk thereby supporting a stronger US dollar.
      • Despite expectations of a slowing global economy and a decrease in the consumption of oil, the price of a barrel of oil remains supported by planned output cuts by OPEC.
      • Risk to current market bias: Canada’s headline CPI came in stronger than expected in September. A more hawkish tone from BoC might push the terminal rate expectations closer to the Fed’s 4.8%, resulting in a stronger CAD. 
      ASIA/PACIFIC

      Chinese yuan (CNH/CNY)
      Market Bias: Bearish

      • There is no evidence of a changing direction for the Zero-COVID policy and housing market policies, the two major factors that are slowing down China’s economy.
      • The capital outflow risk continues to increase as the policy divergence between China and other major economies is widening.  
      • Risk to current market bias: China is debating a reduction in COVID quarantine for inbound travelers. Potential relief on COVID restrictions could support RMB. According to Reuters, major state-owned banks in China swapped RMB for US dollars in the forwards market and sold those dollars in the spot market to stabilize RMB during the Communist Party Congress.
      JPY

      Market Bias: Bearish

      • Japan's inflation reached 3%, exceeding the Bank of Japan's (BOJ) target of 2%, yet rate hikes are nowhere in sight suggesting the currency will continue to receive downward pressure from low interest rates.
      • USD/JPY reached the key psychological level of 150, then 152 for the first time in 32 years, prompting the BOJ to intervene in currency markets by buying JPY. As with previous interventions, the initial impact was a success, as the currency appreciated to 146. However, there is no guarantee that the level will hold as intervention is generally a temporary and very expensive fix.
      • Risk to current market bias: The BOJ wants to prevent the JPY from weakening rapidly. In August, Japan had $1.17 trillion in reserves, and the September intervention cost Japan $20 billion, according to the Washington Post. There is enough buffer for ongoing interventions.
      Inflation-protected bonds
        Breakeven rate between standard government bonds vs inflation-protected bonds (%)
        Inflation Target (%) Current Inflation (%) 3Y 5Y 10Y
      US  2 8.2 2.61 2.6 2.46
      UK 2 10.1   4.08 3.78
      Germany  4.5 10 2.4 3.11 2.28
      Canada 2 6.9   2.19 2.09
      Japan  2 3   1.27 0.91

      Source: Bloomberg: World Inflation Breakeven Rates

    Contact Us

    For more analysis on FX markets or information regarding SVB's FX services:

    Contact your respective SVB FX Advisor or the SVB FX Advisory Team at GroupFXRiskAdvisory@svb.com.
    See all of SVB's latest FX information and commentary at www.svb.com/foreign-exchange-advisory

    Subscribe to receive FX updates to your inbox.


    • C-Level Executive (CEO, COO, CFO, CMO, CRO, CDO, ...)
    • Financial Executive
    • Director
    • Founding Team
    • Investor
    • Administrative or Accounting Role
    • Product Executive
    • Other
    • Single Family Office
    • Multi Family Office
    • Placement Agent
    • Startup
    • Venture Fund
    • Other
    • United States
    • Afghanistan
    • Albania
    • Algeria
    • American Samoa
    • Andorra
    • Angola
    • Anguilla
    • Antarctica
    • Antigua and Barbuda
    • Argentina
    • Armenia
    • Aruba
    • Ascension
    • Australia
    • Austria
    • Azerbaijan
    • Bahamas
    • Bahrain
    • Bangladesh
    • Barbados
    • Belarus
    • Belgium
    • Belize
    • Benin
    • Bermuda
    • Bhutan
    • Bolivia
    • Bosnia and Herzegovina
    • Botswana
    • Brazil
    • British Virgin Islands
    • Brunei
    • Bulgaria
    • Burkina Faso
    • Burundi
    • Cambodia
    • Cameroon
    • Canada
    • Cape Verde Islands
    • Cayman Islands
    • Central African Republic
    • Chad
    • Chatman Island (New Zealand)
    • Chile
    • China
    • Christmas Island
    • Cocos (Keeling) Islands
    • Colombia
    • Comoros
    • Congo
    • Cook Islands
    • Costa Rica
    • Croatia
    • Cuba
    • Curacao
    • Cyprus
    • Czech Republic
    • Denmark
    • Djibouti
    • Dominica
    • Dominican Republic
    • Easter Island
    • Ecuador
    • Egypt
    • El Salvador
    • Equatorial Guinea
    • Eritrea
    • Estonia
    • Ethiopia
    • Falkland Islands
    • Faroe Islands
    • Federated States of Micronesia
    • Fiji
    • Finland
    • France
    • French Antilles
    • French Guyana
    • French Polynesia
    • Fyrom (Macedonia)
    • Gabon
    • Gambia
    • Georgia
    • Germany
    • Ghana
    • Gibraltar
    • Greece
    • Greenland
    • Grenada and Carriacuou
    • Grenadin Islands
    • Guadeloupe
    • Guam
    • Guantanamo Bay
    • Guatemala
    • Guernsey, C.I.
    • Guiana
    • Guinea
    • Guinea-Bissau
    • Guyana
    • Haiti
    • Honduras
    • Hong Kong
    • Hungary
    • Iceland
    • India
    • Indonesia
    • Iran
    • Iraq
    • Ireland
    • Isle of Man
    • Israel
    • Italy
    • Ivory Coast
    • Jamaica
    • Japan
    • Jersey
    • Jerusalem
    • Jordan
    • Kazakhstan
    • Kenya
    • Kiribati
    • Korea (Rep.)
    • Korea, Democratic Peoples Republic of
    • Kuwait
    • Kyrgyzstan
    • Laos
    • Latvia
    • Lebanon
    • Lesotho
    • Liberia
    • Libya
    • Liechtenstein
    • Lithuania
    • Luxembourg
    • Macau
    • Madagascar
    • Malawi
    • Malaysia
    • Maldives
    • Mali
    • Malta
    • Mariana Islands
    • Marshall Islands
    • Martinique
    • Mauritania
    • Mauritius
    • Mayotte
    • Mexico
    • Midway Islands
    • Miquelon
    • Monaco
    • Mongolia
    • Montenegro
    • Montserrat
    • Morocco
    • Mozambique
    • Myanmar
    • Namibia
    • Nauru
    • Nepal
    • Neth. Antilles
    • Netherlands
    • Nevis
    • New Caledonia
    • New Zealand
    • Nicaragua
    • Niger
    • Nigeria
    • Niue
    • Norfolk Island
    • Norway
    • Oman
    • Pakistan
    • Palau
    • Palistinian Territories
    • Panama
    • Papua New Guinea
    • Paraguay
    • Peru
    • Philippines
    • Poland
    • Portugal
    • Principe
    • Puerto Rico
    • Qatar
    • Republic of Macedonia
    • Republic of Moldova
    • Reunion Island
    • Romania
    • Russia
    • Rwanda
    • Saint Martin
    • Saipan
    • San Marino
    • Sao Tome and Principe
    • Saudi Arabia
    • Senegal Republic
    • Serbia and Montenegro
    • Seychelles
    • Sierra Leone
    • Singapore
    • Sint Maarten
    • Slovakia
    • Slovenia
    • Solomon Islands
    • Somalia
    • South Africa
    • Spain
    • Sri Lanka
    • St Pierre et Miquelon
    • St. Helena
    • St. Kitts
    • St. Lucia
    • St. Vincent
    • Sudan
    • Suriname
    • Swaziland
    • Sweden
    • Switzerland
    • Syria
    • Taiwan
    • Tajikistan
    • Tanzania
    • Thailand
    • Togo
    • Tokelau
    • Tonga
    • Trinidad and Tobago
    • Tunisia
    • Turkey
    • Turkmenistan
    • Turks and Caicos Islands
    • Tuvalu
    • U.S. Virgin Islands
    • Uganda
    • Ukraine
    • United Arab Emirates
    • United Kingdom
    • Uruguay
    • Uzbekistan
    • Vanuatu
    • Vatican City
    • Venezuela
    • Vietnam
    • Wake Island
    • Wallis and Futuna Islands
    • Western Samoa
    • Yemen
    • Yugoslavia
    • Zaire
    • Zambia
    • Zanzibar
    • Zimbabwe
    • AK
    • AL
    • AR
    • AZ
    • CA
    • CO
    • CT
    • DC
    • DE
    • FL
    • GA
    • HI
    • IA
    • ID
    • IL
    • IN
    • KS
    • KY
    • LA
    • MA
    • MD
    • ME
    • MI
    • MN
    • MO
    • MS
    • MT
    • NC
    • ND
    • NE
    • NH
    • NJ
    • NM
    • NV
    • NY
    • OH
    • OK
    • OR
    • PA
    • RI
    • SC
    • SD
    • TN
    • TX
    • UT
    • VA
    • VT
    • WA
    • WI
    • WV
    • WY
    By providing your email address, you consent to receive emails from Silicon Valley Bank. You also consent to the terms of our Privacy Policy. If you have privacy questions, you may contact us at privacy@svb.com. You can withdraw your consent at any time.
    Submit

    Thank you for subscribing to SVB's FX Update.


    You're almost done. Please check your email box and follow the instructions to confirm your subscription. If you did not receive an email please check your Spam or Bulk E-Mail folder just in case the confirmation email got delivered there instead of your inbox. If so, select the confirmation message and mark it Not Spam, which should allow future messages to get through. Please add us to your trusted list of senders, contacts or address book.

    Please note that we will continue to send you communications that we need to send you (for example, to keep you updated on operational changes to your account, a product or a service) or that we are required to send you by law.

    Oops, we ran into an error loading the form, please check back later.

     Source: Bloomberg
     

    This article is intended for U.S. audiences only.

    ©2023 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. Silicon Valley Bank is the California bank subsidiary of SVB Financial Group (Nasdaq: SIVB). SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license.

    The views expressed in this email are solely those of the author and do not reflect the views of SVB Financial Group, or Silicon Valley Bank, or any of its affiliates. This material, including without limitation the statistical information herein, is provided for informational purposes only. The material is based in part upon information from third-party sources that we believe to be reliable, but which has not been independently verified by us and, as such, we do not represent that the information is accurate or complete. The information should not be viewed as tax, investment, legal or other advice nor is it to be relied on in making an investment or other decisions. You should obtain relevant and specific professional advice before making any investment decision. Nothing relating to the material should be construed as a solicitation or offer, or recommendation, to acquire or dispose of any investment or to engage in any other transaction.

    Foreign exchange transactions can be highly risky, and losses may occur in short periods of time if there is an adverse movement of exchange rates. Exchange rates can be highly volatile and are impacted by numerous economic, political and social factors, as well as supply and demand and governmental intervention, control and adjustments. Investments in financial instruments carry significant risk, including the possible loss of the principal amount invested. Before entering any foreign exchange transaction, you should obtain advice from your own tax, financial, legal, accounting and other advisors, and only make investment decisions on the basis of your own objectives, experience and resources.

    Kathy Sun
    WRITTEN BY
    Kathy Sun
    Kathy Sun is a foreign exchange advisor on Silicon Valley Bank’s global fund banking team in San Francisco.
    • View Author Profile
    • LinkedIn
    • Email

    Insights from SVB Industry Experts

     
    SVB experts provide our customers with industry insights, proprietary research and insightful content. Check out these related articles that may be of interest to you.

    FX Weekly: Risk-on tone continues as Fed pause nears while USD shows continued softness

     
    Chandler White
    Read more

    FX Weekly: US Non-Farm Payrolls Exceed Forecast, Attention turns to Thursday CPI Reading; Slight Dollar Sell Off

     
    Andrew Rossillon
    Read more

    FX Weekly: Dollar begins 2023 stronger

     
    Read more

    FX Weekly: Consumer sentiment rises for the holiday season

     
    Kathy Sun
    Read more

    FX Weekly: US dollar sell-off pauses amid fears of continued Federal Reserve rate hikes tipping the US economy into a deep recession

     
    Nicholas Farguson
    Read more

    FX Weekly – Dollar weaker on positive risk sentiment and other central banks catching up to the Fed

     
    Neil Dave
    Read more
    • How We Help Clients
    • Trends & Insights
    • About Us
    • Contact & Support
    • Careers
    Subscribe to newsletters
    Sign up now
    United States
    How We Help Clients
    • Starting Up
    • Venture-Funded
    • Corporate Banking
    • Investors
    • Private Banking & Wealth Advisory
    • Industries We Serve
    Trends & Insights
    • SVB Signature Research
    • SVB Perspectives
    • Success Stories
    • Startup Insights
    About Us
    • Careers
    • Living Our Values
    • Newsroom
    • Investor Relations
    • Leadership
    Contact & Support
    • Locations
    • Client Service & Support
    • Vendor Information
    • Contact
    • Fraud Prevention
    Image
    • Terms of Use
    • Privacy
    • Cookies
    • Help for Homeowners
    • Corporate Governance
    • Equal Credit Opportunity Act Disclosures
    • FDIC
    • Manage Email Preferences
    • LIBOR Transition
    © 2023 SVB Financial Group. All rights reserved. SVB Financial Group (SVB) is the holding company for all business units and groups. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. Silicon Valley Bank is the California bank subsidiary of SVB Financial Group (Nasdaq: SIVB). SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, and the chevron device are trademarks of SVB Financial Group, used under license.
    You are now leaving Silicon Valley Bank (SVB)
    You will be directed to a different website or mobile app that has its own terms of use, visitor agreement, security and privacy policies. SVB is not responsible for (and does not provide) any products, services or content at the third party site or app, except for the products and services that carry the SVB name.
    I understand, let's proceed Stay on SVB.com