Concern for slowed growth supports haven currencies

Concern for slowed growth supports haven currencies

Data out of the US and China caused concerns of slowing growth which supported haven currencies. Later this week, the Federal Reserve will host a symposium at Jackson Hole. Commentary from Federal Reserve Chairman Powell regarding his views around strong employment data and any change to his previous standpoint that “substantial further progress” is still needed ahead of any bond tapering will be watched closely.

Economic Data for this week: 

Tuesday: US Retail Sales, UK Jobless Claims, Eurozone GDP

Wednesday: Australian Unemployment, UK CPI

Thursday: US Initial Jobless Claims

  • FX Rates
    August 16, 2021

    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
    Data out of the US released on Friday showed a drop in consumer confidence. This resulted in a shift for global risk appetite as investors remain concerned about a growth slowdown. Safe haven currencies including the US dollar strengthened on the news.
    GBP
    The British pound remains largely unchanged versus the greenback as risk appetite for global markets wanes following data out of the US and China. A busy week of UK data is expected to impact sterling; focus will be on labor market report Tuesday, inflation data Wednesday and retail sales Friday.
    EUR
    One-month implied volatility for EUR/USD is at its lowest level since February 2020. This is signaling that traders are betting that volatility for the currency pair will stay low despite upcoming meeting for the Fed and the European Central Bank in September.
    CAD

    The Canadian dollar weakened versus the US dollar amidst lower commodity prices including oil. USD/CAD is trading about 0.3% higher, the largest gain in more than a week. WTI crude is down 1.75%.

    ASIA/PACIFIC

    The Japanese yen, along with other haven currencies, advanced as investors are concerned about slowed growth and ahead of the Federal Reserve’s symposium in Jackson Hole later this month.

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Cate Camerota
WRITTEN BY
Cate Camerota

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