Commodity-linked currencies decline as USD gains

Silicon Valley Bank

August 4, 2020

Commodity-linked currencies decline as USD gains

WTI oil prices slide to $40/bbl as markets moved away from risky assets. Investors shifted focus to negotiations between US lawmakers regarding a recovery package to address the coronavirus pandemic. G10 currencies weakened against the greenback except for the Australian dollar which strengthened following a statement from the central bank vowing to resume quantitative easing measures on Wednesday.

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FX Rates
August 4, 2020

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 1.1730
GBP/USD 1.2995
USD/CAD 1.3415
AUD/USD 0.7121
USD/JPY 106.09
USD/CNH 6.9882
USD/ILS 3.4245
USD/MXN 22.8601
USD/CHF 0.9170
USD/INR 75.0500
USD
The US dollar swung between gains and losses earlier in the trading session as the market anticipates data releases including employment numbers due later this week. The expectation is for jobless claims to remain high.
GBP
Sterling is headed towards a third day of losses dropping to a low of 1.3005. Bank of England is scheduled to meet later this week and the market is expecting that the central bank will keep its benchmark rate unchanged.
EUR
The EUR slipped early in the session following mixed data released out of the eurozone. EUR is currently trading around today’s low of 1.1741.
CAD
USD/CAD is trading higher hitting levels above 1.34. The loonie weakened against the US dollar as WTI crude oil prices fell 1.7% to $40.32/bbl.
ASIA/PACIFIC
USD/JPY rose to a high of 106.19 struggling to trade beyond the 106.20 level. The Australian dollar strengthened versus the US dollar following a statement from the central bank pledging to resume quantitative easing.

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/trends-insights/foreign-exchange-advisory

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Source: Bloomberg

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

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