The US dollar is weaker across the board after China reported no new COVID cases in Shanghai for a third day. US Retail Sales figures came in better than expected showing a resilient consumer. The euro traded over 1.05 after comments from an ECB official suggesting multiple rate increases this year. Oil trades over $115/bbl giving strength to the Canadian dollar.
"Do something worth remembering."
May 17, 2022
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/USD 1.0532 GBP/USD 1.2466 USD/CAD 1.2850 AUD/USD 0.7018 USD/JPY 129.73 USD/CNH 6.7320 USD/ILS 3.3504 USD/MXN 19.9396 USD/CHF 0.9937 USD/INR 77.5663 USD/BRL 4.9721 USD/SGD 1.3851 USD/DKK 7.0637 USD/SEK 9.9148 USD/NOK 9.6742
The dollar sold off versus most currencies as risk-on sentiment returned. April Retail Sales missed (+0.9%) the headline estimate (+1.0%) but the core number (+1.0%) beat forecast (+0.7%). Prior month Retail Sales were revised upward to +1.4% from +0.5%. The dollar rallied slightly on the Retail Sales figure then continued its selloff.GBP
Sterling trades higher this morning following improved UK jobs data. The UK economy added far more jobs than expected, while unemployment data and average earnings both beat forecasts. The UK will lay out its plan to amend post-Brexit trade. The government plans to introduce laws that would override the Northern Ireland protocol, should no progress be made over talks. The EU has stated it could suspend the entire agreement if the UK changes the protocol.EUR
The euro strengthened to 1.055 on overall US dollar weakness and comments from ECB Governing Council members supporting a 0.25% hike in July and possibly larger increases later this year. EU ambassadors are to hold more talks on the proposed Russian oil ban, an issue which has been particularly divisive. Macron names Elisabeth Borne as France’s second female PM.CAD
The Canadian dollar headed toward a third day of gains on overall US dollar weakness and a gain in the price of oil. West Texas Intermediate traded over $115/bbl until US April Retail Sales showed gas sales were a bit weaker than expected in April.ASIA/PACIFIC
The Chinese renminbi gained strength on hopes the lockdown in Shanghai may end soon after Beijing reported no new COVID infections for a third day. Authorities stated this was an important milestone before unwinding lockdown measures.
The Reserve Bank of New Zealand (RBNZ) could hike rates by 0.5% at each of its next three meetings to get on top of inflation.
For more analysis on FX markets or information regarding SVB's FX services:
See all of SVB's latest FX information and commentary at www.svb.com/foreign-exchange-advisory
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.