Market pressure has eased as traders re-access the potential damage from the new Omicron COVID variant. Global equities are higher –S&P 500 futures are trading higher by over 40 points, global bond yields are higher – US Treasury 10yr yields jumped by 7 bps to 1.55%, and the dollar is mixed. Traders await today’s Fed speeches and a week full of economic data, including Friday’s US jobs data for November. Oil is up over 5% to $72.80 per barrel.
Key economic data and events:
US Pending Home Sales, Dallas Fed Manufacturing Survey, speeches by NY Fed President Williams and Fed Chair Powell, Eurozone Confidence Indices, China PMI
US Case-Shiller National Home Price Index, Chicago Purchasing Manager Index, Consumer Confidence Index Eurozone CPI, Canada GDP
US ADP National Employment Report, Construction Spending, Eurozone Manufacturing PMI
US Initial Jobless Claims, Eurozone Unemployment
US ISM Services PMI, Nonfarm Payrolls, Unemployment Rate, Factory Orders, Canada jobs data, Eurozone Retail Sales, UK Manufacturing PMI
November 29, 2021
EUR/USD 1.1267 GBP/USD 1.3305 USD/CAD 1.2745 AUD/USD 0.7142 USD/JPY 113.88 USD/CNH 6.3894 USD/ILS 3.1623 USD/MXN 21.7549 USD/CHF 0.9261 USD/INR 75.0925 USD/BRL 5.5838 USD/SGD 1.3696 USD/DKK 6.5987 USD/SEK 9.1003 USD/NOK 9.0405
Friday’s market rout was effectively reversed, as traders reassess risks related to the new Omicron variant. The US dollar is mixed, making solid gains against the euro, Japanese yen, and Swiss franc. Markets await speeches from NY Fed President Williams and Fed Chair Powell and a full docket of economic data, including the all-important jobs data on Friday.GBP
The UK pound is unchanged from Friday’s close, as pressure from the Omicron variant eases. UK health officials have said they are not anticipating tightening social restrictions despite the spread potential of the new COVID variant.EUR
The euro is the worst performing G-10 currency following dovish comments by an ECB member of its governing council. The Stoxx Europe 600 index has rebounded by over 2% from Friday’s rout, which was its worst drop in more than a year. Traders await a full docket of eurozone aggregate economic data to be released this week.CAD
The Canadian dollar is higher versus USD along with other commodity currencies that have recovered from Friday’s rout. Canada benefits from having a high COVID vaccination rate. OPEC meets this week to discuss the potential impact of the Omicron variant.ASIA/PACIFIC
Despite Asian stocks declining as emerging markets continue struggling with the global pandemic, the Chinese yuan remains strong. The PBOC is making an effort to show confidence in China’s economy without having to weaken its currency to support exporters.
The JPY is soft on reduced safe haven buying, and the AUD is higher as commodity prices rebound from Friday’s rout.
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
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