Dollar weaker amid risk-on trading

Kathryn Garvey

September 14, 2020

Dollar weaker amid risk-on trading

Risk sentiment improved over the weekend as stocks open in the green sending the dollar lower. Traders will focus on central bank meetings this week. The Federal Reserve will meet tomorrow and the BoE will meet on Thursday. Pfizer’s CEO Albert Bourla made comments that a Covid-19 vaccine could be distributed by year-end.

ECONOMIC DATA:

Monday: Japan Industrial Production MoM
Tuesday: German ZEW Survey
Wednesday: FOMC Rate Decision, Canadian CPI
Thursday: BoE Bank Rate Decision, US Initial Jobless Claims

FX Rates
September 14, 2020

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.

EUR/USD 1.1876
GBP/USD 1.2892
USD/CAD 1.3176
AUD/USD 0.7281
USD/JPY 105.70
USD/CNH 6.8136
USD/ILS 3.4371
USD/MXN 21.1660
USD/CHF 0.9063
USD/INR 73.4850
USD
FOMC’s two-day September meeting begins Tuesday. The Fed will release a policy statement that includes 2023 forecasts for the first time. The dollar is lower amid risk-on trading following renewed optimism on a coronavirus vaccine.
GBP
The pound climbed near three quarters of a percent on short covering and demand for topside options. The BoE will meet to discuss monetary policy on Thursday. No interest rate change is expected, but conversation will continue on further quantitative easing efforts.
EUR
The euro climbed higher for a fourth day sustained by a business sentiment index in France beating expectations. Near term resistance is September 10 high of 1.191.
CAD
The Canadian dollar rose against the greenback amid optimism on a Covid -19 vaccine by year-end. Data today includes the Bloomberg Canada economic survey.
ASIA/PACIFIC
The Japanese yen rose versus the US dollar as markets reacted to news that Yoshihide Suga won his party’s election to replace Shinzu Abe as Prime Minister.

The New Zealand dollar advanced after the government lowered the Covid-19 alert level. The Australian dollar dropped following reports that the Reserve Bank was considering additional debt purchases and a cut to cash rates.

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/trends-insights/foreign-exchange-advisory

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Source: Bloomberg

This article is intended for U.S. audiences only.

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WRITTEN BY

Kathryn Garvey

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