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Markets pause, dollar edges higher after a big down week
Equity markets are pausing to end what’s been another upbeat week. The US dollar has edged higher overnight after a most difficult week, having lost between 1-2% against most of its G-10 peers. Investors are digesting snags in EU-UK post-Brexit trade talks and on slow progress with the US fiscal spending deal. US equities are opening up slightly, bond yields are steady, and the dollar index up by 0.15%. Oil and gold prices are steady.
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FX Rates
December 18, 2020Rates 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 1.2246 GBP/USD 1.3502 USD/CAD 1.2751 AUD/USD 0.7604 USD/JPY 103.3200 USD/CNH 6.5179 USD/ILS 3.2366 USD/MXN 19.8494 USD/CHF 0.8851 USD/INR 73.5700
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USD
The dollar is higher across the board overnight, but traders remain bearish the dollar over the long-term. Demand for foreign currencies comes amid market optimism related to Covid-19 vaccines deployment, fiscal policy approaching agreement, the Fed’s “lower for longer” message and negative real rates in US treasuries.
GBPThe UK pound is the worst performing currency in overnight trading as the post-Brexit trade negotiations struggle with fishing rights.
EURThe euro moved little overnight, but trades comfortably over $1.22. The currency is up nearly 1.2% this week, having reached its highest level since April 2018. This week’s slew of economic statistics generally positively surprised.
CADThe Canadian dollar eased overnight, despite Canada’s Retail Sales exceeding expectations. Sales in October rose 0.4% over September, it’s sixth straight monthly gain, compared favorably with survey predictions of no change. The USD/CAD dropped below 1.28 this week for the first time since September 2018.
ASIA/PACIFICThe Chinese yuan has changed little overnight, and is ending the week virtually unchanged. The USD/CNY currency pair remains well within a downtrend which began in June.
The Japanese yen moved little overnight. Comments by BOJ Governor Kurado yesterday left investors wondering how long the BOJ will remain committed to its ultra-easy monetary policy. He said that in March they will announce findings of a study on the success of its main monetary policy outline.
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