Risk sentiment was bolstered overnight and investors moved out of haven assets after news that Shanghai will be re-opening after weeks of lockdown. The dollar remains near 20-year highs however USD gave some ground back to G-10s on the improved risk sentiment.
May 13, 2022
EUR/USD 1.0373 GBP/USD 1.2171 USD/CAD 1.2983 AUD/USD 0.6885 USD/JPY 129.27 USD/CNH 6.8155 USD/ILS 3.4208 USD/MXN 20.2190 USD/CHF 1.0033 USD/INR 77.43 USD/BRL 5.1429 USD/SGD 1.3964 USD/DKK 7.1760 USD/SEK 10.1069 USD/NOK 9.8262
The dollar pulled back on minor risk-tolerance return and stays near 20-year highs. Fed Chair Powell reiterated a commitment to 50bp hike increases at the next two meetings and mentioned that a recession will come down to points outside of the Fed’s control.GBP
The pound hit fresh two-year lows this morning following news that the UK economy contracted 0.1%. This reading adds to mounting fears of a recession. Bears eye a slide below 1.20.EURThe euro continues its slide after reaching a five-year low yesterday. Bears have a move to parity with the USD at a 60% chance.CADThe loonie strengthened versus the dollar after USD/CAD touched the highest levels since November yesterday. WTI futures rose too, helping the Canadian currency.ASIA/PACIFIC
Risk-on sentiment bolstered by strong performances in equity markets weighed on safe haven assets. USD/JPY pulled back from two-year highs, and 130 remains a psychological top.
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/trends-insights/foreign-exchange-advisory
By providing your email address and clicking on the Subscribe button below, you consent to receive emails from Silicon Valley Bank for your chosen categories. You also consent to the terms of our Privacy Notice. If you have privacy questions, you may contact us at PrivacyOffice@svb.com. You can withdraw your consent at any time.
Thank you for subscribing to SVB's Daily 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.
This article is intended for U.S. audiences only.
©2022 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.