US productivity turned negative in Q3 as labor costs rise more than expected raising questions about Fed policy
Peter Compton " | November 6, 2019
The dollar is weaker against most currencies as poor economic data led to profit taking after several days of dollar strengthening. Optimism on a US/China trade deal awaits confirmation as the Chinese ask Trump to lower his tariff weapon. Canadian dollar weakens on lower oil prices.
“Optimism is the faith that leads to achievement. Nothing can be done without home and confidence.”
November 6, 2019
EUR/USD 1.1083 GBP/USD 1.2878 USD/CAD 1.3179 AUD/USD 0.6894 USD/JPY 108.98 USD/CNH 7.0003 USD/ILS 3.4897 USD/MXN 19.2133 USD/CHF 0.9929 USD/INR 70.9888
Dollar bulls take a break as US productivity data comes in weaker than expected. Several Federal Reserve governors are speaking today at various events as financial markets listen carefully for a consensus on the pause in rate cuts signaled at last week’s Fed meeting.GBP
The British pound is stronger today on overall US dollar profit taking. The UK parliament is dissolved today in preparation for the general election in 5 weeks’ time.EUR
The euro gained as investor sentiment turned optimistic that Germany would provide additional fiscal stimulus. The German Finance Minister suggested deeper eurozone bank integration and a common deposit insurance scheme – something other countries have been seeking for years.CAD
The Canadian dollar was one of the few major currencies to lose to the US dollar – mostly on weaker oil prices. The price of West Texas Intermediate seems to be topping out at $57/bbl despite a recent optimistic outlook for global economic growth.ASIA/PACIFIC
The Chinese renminbi held onto most of yesterday’s gains to trade just under the key 7 level. Trade negotiators for China conveyed the importance of cutting tariffs as part of the “Phase 1” trade talks with the US.
The Indian rupee lost ground after weak services sector data showed contraction.
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