Markets quiet, dollar lower, stocks holding near record highs
In quiet end-of-year trading, the dollar is lower, mostly against the Australian dollar, which climbed to fresh 2 ½ year highs. Stocks are holding near record highs amid year-end USD funding needs which were not under pressure. US Initial Jobless Claims were better than expected this morning. US Treasuries, oil and gold are all little changed overnight. Markets in Japan, Germany, and S. Korea were closed today, and most stock markets around the world will be closed tomorrow for New Year’s Day.
December 31, 2020
EUR/USD 1.227 GBP/USD 1.3645 USD/CAD 1.2718 AUD/USD 0.7736 USD/JPY 103.07 USD/CNH 6.5034 USD/ILS 3.2152 USD/MXN 19.8706 USD/CHF 0.8802 USD/INR 73.0700
The dollar is ending the year lower and within a well-entrenched downtrend which began March 20 of this year. Year-end funding needs was not unusual this time around, meaning no excessive demand for the dollar. US jobless claims data came in better than expected. Markets are closed tomorrow.GBP
The UK pound edged higher, reaching $1.3686, its highest level since May 2018. It is ending the year up 3.0%, lagging most other G-10 currencies. After UK Parliament approved the UK-EU post-Brexit deal yesterday, tonight at 11pm London time Britain formally exits the European Union’s trading bloc.EUR
The euro fell slightly overnight as the Stoxx Europe 600 Index fell 0.4%.CAD
The Canadian dollar gained 0.3% overnight, in line with broad US dollar weakness and ahead of next week’s OPEC+ meeting. No economic data for Canada was reported today.ASIA/PACIFICThe Chinese yuan dropped in value overnight, leading to an outperformance of Chinese stocks.
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
By providing your email address and clicking on the Subscribe button below, you consent to receive emails from Silicon Valley Bank for your chosen categories. You also consent to the terms of our Privacy Notice. If you have privacy questions, you may contact us at PrivacyOffice@svb.com. You can withdraw your consent at any time.
Thank you for subscribing to SVB's Daily FX Update.
You're almost done. Please check your email box and follow the instructions to confirm your subscription. If you did not receive an email please check your Spam or Bulk E-Mail folder just in case the confirmation email got delivered there instead of your inbox. If so, select the confirmation message and mark it Not Spam, which should allow future messages to get through. Please add us to your trusted list of senders, contacts or address book.
Please note that we will continue to send you communications that we need to send you (for example, to keep you updated on operational changes to your account, a product or a service) or that we are required to send you by law.
This article is intended for U.S. audiences only.
©2021 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. Silicon Valley Bank is the California bank subsidiary of SVB Financial Group (Nasdaq: SIVB). SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license.
The views expressed in this email are solely those of the author and do not reflect the views of SVB Financial Group, or Silicon Valley Bank, or any of its affiliates. This material, including without limitation the statistical information herein, is provided for informational purposes only. The material is based in part upon information from third-party sources that we believe to be reliable, but which has not been independently verified by us and, as such, we do not represent that the information is accurate or complete. The information should not be viewed as tax, investment, legal or other advice nor is it to be relied on in making an investment or other decisions. You should obtain relevant and specific professional advice before making any investment decision. Nothing relating to the material should be construed as a solicitation or offer, or recommendation, to acquire or dispose of any investment or to engage in any other transaction.
Foreign exchange transactions can be highly risky, and losses may occur in short periods of time if there is an adverse movement of exchange rates. Exchange rates can be highly volatile and are impacted by numerous economic, political and social factors, as well as supply and demand and governmental intervention, control and adjustments. Investments in financial instruments carry significant risk, including the possible loss of the principal amount invested. Before entering any foreign exchange transaction, you should obtain advice from your own tax, financial, legal and other advisors, and only make investment decisions on the basis of your own objectives, experience and resources.