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Daily
FX Update

The dollar is strong heading into Fed meeting; U.K. Supreme Court hears landmark Brexit case

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The US dollar is slightly higher going into the 2-day Fed meeting which begins today. An interest rate cut of 25 bps is already priced into the markets. The UK Supreme Court begins hearings on BoJo’s decision to suspend Parliament. The pound looks to decisions made in court for direction. Oil prices cooled off overnight after the US hinted it will release reserves to sustain global oil markets after attacks in Saudi Arabia knocked out 5% of global supply.
Honoré de Balzac, French Novelist
  • FX Rates
    September 17, 2019

    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
    The dollar extends yesterday’s gains as demand for the currency increased ahead of the week’s monetary policy decisions. The Fed begins its 2-day meeting today during which a 25bp cut is expected. The US commitment to deploy oil reserves lowered crude oil prices as Saudi Arabia begins to figure out how to replenish production capacity.
    GBP
    The pound seeks to recover some of Monday’s losses and is in search of direction driven by Brexit news. A hearing in the UK’s Supreme Court begins today on Boris Johnson’s decision to suspend Parliament. The case threatens to undermine the power of the prime minister and could also force him to recall the suspension decision – which would give those opposing a no-deal Brexit more time to pass laws blocking a no-deal departure come October 31.
    EUR
    The euro is slightly higher after dropping 0.64% yesterday. ECB Chief Economist, Philip Lane said in a speech yesterday that a split in opinion in the central bank is okay after the divergence of views from ECB leaders during last week’s meeting.
    CAD
    The loonie dropped this morning driven mostly by weaker-than-expected Manufacturing Sales data for July. Sales declined 1.3% in July versus -0.2% expected. A cool-off in oil prices after Monday’s historic surge also drove the Canadian dollar lower.
    ASIA/PACIFIC
    President Trump has notified lawmakers he has reached an initial agreement on reciprocal tariff reductions with Japan. The yen weakened slightly on the news. The Bank of Japan is set to meet on Thursday in a regularly scheduled meeting.

    China’s renminbi weakened overnight after the central bank kept one-year rates on medium term loans steady on Tuesday indicating the central bank prefers not to provide too much liquidity to the markets.
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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/foreign-exchange

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About the Author

Kathryn Garvey is a foreign exchange Associate for Silicon Valley Bank’s global financial services group and has been with SVB since July of 2018. Prior to SVB Kathryn completed co-op internships at Innosight, Market Metrics, and The TJX Companies.

Garvey graduated from Northeastern University in 2018 with a bachelor’s degree in finance, and marketing with elective coursework in entrepreneurship and innovation from Northeastern University.

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