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Daily
FX Update

Dollar weak as traders await Saturday’s historic Brexit vote by Parliament

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October’s sell-off in the dollar continued, as the index approaches its weakest level since July. Traders await Saturday’s UK Parliament Brexit vote where there is no clear outcome. Tariffs on EU goods take effect today. China’s economy grew at the slowest pace in more than 27 years. 

“When you’ve seen beyond yourself, then you may find, peace of mind is waiting there.”
George Harrison
  • FX Rates
    October 18, 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 downtrend in October remains intact as the index approaches its lowest levels since July. Liquidity is tightening up as traders await the Brexit vote on Saturday, which may impact all markets.

    GBP

    The UK pound was range-bound overnight, yet is poised for a third week of gains. Traders await Parliament's vote Saturday on PM Boris Johnson’s deal  with the EU, while markets prepare for a potentially volatile beginning late Sunday when Asian markets open.

    EUR

    The euro is playing catch-up with the pound’s recent surge, and now approaches three-month highs. There is little eurozone economic data on the docket today. US tariffs take effect today on specialty EU agriculture/food products, like French wine, Italian cheese and Spanish olives.

    CAD

    The Canadian dollar moved little overnight as we approach Canada’s October 21 general election. Election results are uncertain, and it’s doubtful that any party will be able to form a majority government. Economic impacts from the election are decidedly unclear, and traders are becoming increasingly pessimistic.

    ASIA/PACIFIC

    The Chinese yuan weakened slightly following release of China’s Q3 GDP data. GDP growth of 6.0% met expectations, but more importantly, it did not drop below 6%. A more negative view on global trade will follow a drop below 6%, which traders expect to see next year.
    The Australian dollar hit fresh one-month highs, despite China’s weak GDP. Traders continued to unwind overly short positions following recent strong Aussie job data.

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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

Scott Petruska is Chief Currency Strategist and senior advisor for Silicon Valley Bank’s global financial services group, and is based in Boston, MA. He advises clients on currency and interest rate hedging strategies, and helps them with other aspects of global banking. He regularly writes blogs on topics covering the global financial markets, conducts client seminars and webinars, and speaks at regional financial conferences.

Petruska has more than 30 years experience in the currency and interest rate markets, and has lived and worked in Boston, Chicago, New York City, Singapore and Tokyo. Prior to joining SVB in 2009, he worked at several large international financial institutions, including National Westminster Bank, Irving Trust, Bank of New York, State Street Bank and Commerce Bank. He has been an institutional trader, product developer, analyst, salesperson and advisor.

Petruska has been awarded several professional designations, including the CFA (Chartered Financial Analyst), FRM (Financial Risk Manager) and CMT (Certified Market Technician). He earned his undergraduate degree in Finance & Banking from the University of Wisconsin.

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