Equities lower on break from rally, dollar edges higher
“Injustice anywhere is a threat to justice everywhere.”
June 9, 2020
EUR/USD 1.1305 GBP/USD 1.2670 USD/CAD 1.3453 AUD/USD 0.6932 USD/JPY 107.9000 USD/CNH 7.0818 USD/ILS 3.4493 USD/MXN 21.8376 USD/CHF 0.9525 USD/INR 75.6138
In quieter trading, the US dollar edged higher as a drop in risk sentiment moved funds into safe-haven currencies. Traders await the Fed’s next policy decision tomorrow – rates are expected to remain unchanged and above zero. Investors look forward to the OECD’s bi-annual report tomorrow of its economic outlook for member nations.GBP
The UK pound dropped by 0.4% as it takes a break from recent strength. The UK pound is highly sensitive to changes in market sentiment given the UK-EU post-Brexit trade negotiations have stalled and the upcoming deadline for Britain to request an extension to the Brexit transition period.EUR
The rise in the euro is slowing down, and is little changed overnight. Traders are digesting Germany’s sharp fall in industrial production for April, its worst month ever for the German economy. Traders await the eurozone finance ministers' meeting on Thursday to discuss the EU’s recovery package.CAD
The USD/CAD currency pair edged higher, but remains below C$1.35 amid renewed demand for the US dollar and steady oil prices after Saudi Arabia said it would stop extra voluntary production cuts by the end of the month.ASIA/PACIFIC
The USD/Chinese yuan currency pair held under 7.09 as emerging market assets remain well bid in the ongoing risk-on sentiment. Oil prices and commodity currencies remain near recent highs, supported by the OPEC+ decision to extend production cuts.
The Japanese yen strengthened as investors remain concerned about tensions between US and China, particularly following rumors that President Trump may sign the Uyghur Human Rights Policy Act, which will sanction several high-ranking Chinese officials.
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