Daily
FX Update

No Brexit today, the dollar edges lower, equities firm

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It’s March 29, when Britain was officially scheduled to withdraw from the EU. But it’s not taking place, at least not today. Instead, UK’s Parliament will vote on the Prime Minister’s divorce deal, but not on a formal political declaration on the future trade and security relationship with the EU. The dollar is slightly lower, and global equities are finishing their best quarter in years.

“Chaos in the world brings uneasiness, but it allows the opportunity for creativity and growth.”

Tom Barrett, American politician
  • FX Rates
    March 29, 2019

    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

    The FX market is ending the quarter relatively quietly. The dollar edged lower overnight amid declining liquidity and volumes. US equities opened higher, and UST 10Y yields increased two basis points to 2.42%. A slew of US economic data are being released, which should help guide markets as they wind down the week, month and quarter.

    GBP
    Today was originally the day that Britain was to withdraw from the European Union. Instead, UK lawmakers will vote for the third time on Prime Minister May’s terms of a departure from the EU only. If it passes, it would satisfy the EU’s deadline for completing the Brexit process and extend Brexit to May 22. If it doesn’t pass, a messy “no-deal” Brexit on April 12 is a strong possibility.
    EUR

    The euro made limited gains against the dollar overnight. US data out today will guide its movement. Traders remain positioned short the euro.

    CAD

    The Canadian dollar rallied strongly this morning following release of better than expected GDP data for January. It was residential construction, up more than 3% m/m, that did the heaving lifting. Higher oil prices provided additional support for the loonie.

    ASIA/PACIFIC

    It’s fiscal year-end in Japan. The USD/JPY currency pair is trading slightly higher overnight, but remains below the key 111.00 level.

    TRY

    The Turkish lira has seen wild swings ahead of nationwide local elections on Sunday. Nervous traders have dumped the lira over the past 48 hours, fueling a general decline in EM currencies. This past week, Turkey’s government engineered a funding squeeze to stem the currency’s decline, but it led to traders abandoning Turkish stocks and bonds to reduce exposure to the country and its currency.

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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 fxadvisors@svb.com.
See all of SVB's latest FX information and commentary at www.svb.com/foreign-exchange

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About the Author

Scott Petruska is Chief Currency Strategist and senior advisor for Silicon Valley Bank’s global financial services group, and is based in Boston, MA. He advises clients on currency and interest rate hedging strategies, and helps them with other aspects of global banking. He regularly writes blogs on topics covering the global financial markets, conducts client seminars and webinars, and speaks at regional financial conferences.

Petruska has more than 30 years experience in the currency and interest rate markets, and has lived and worked in Boston, Chicago, New York City, Singapore and Tokyo. Prior to joining SVB in 2009, he worked at several large international financial institutions, including National Westminster Bank, Irving Trust, Bank of New York, State Street Bank and Commerce Bank. He has been an institutional trader, product developer, analyst, salesperson and advisor.

Petruska has been awarded several professional designations, including the CFA (Chartered Financial Analyst), FRM (Financial Risk Manager) and CMT (Certified Market Technician). He earned his undergraduate degree in Finance & Banking from the University of Wisconsin.

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