Russia’s Putin agreed to his Foreign Minister’s recommendation to continue diplomatic efforts with the West. European stocks are in red territory, but US stocks are opening flat. Traders await a slew of Fed speakers this week, expecting a hawkish tone following St. Louis Fed President Bullard’s call last week for faster rate hikes. US Treasury yields are higher, the 10YR moving back toward 2.00%. The safe havens -- US dollar, Japanese yen and Swiss franc -- are outperformers. Oil and gold are soft.
Economic News and Events:
Tuesday: US January PPI, Eurozone 4Q Employment & 4Q GDP, Canada Housing Starts
Wednesday: US January Housing Market Index, Retail Sales, Capacity Utilization, Industrial Production, FOMC minutes, Eurozone December Industrial Production, Canada CPI, China CPI
Thursday: US January Housing Starts, Feb-12th Initial Jobless Claims, Eurozone Dec Construction Output
Friday: US January Leading Economic Indicators, Canada Retail Sales
February 14, 2022
EUR/USD 1.1320 GBP/USD 1.3532 USD/CAD 1.2733 AUD/USD 0.7124 USD/JPY 115.53 USD/CNH 6.3548 USD/ILS 3.2595 USD/MXN 20.4231 USD/CHF 0.9261 USD/INR 75.6013 USD/BRL 5.2021 USD/SGD 1.3469 USD/DKK 6.5747 USD/SEK 9.3742 USD/NOK 8.8823
The dollar is in demand as a safe haven currency despite news that Putin will continue diplomacy with the West. An increasingly hawkish Fed is supporting higher bond yields leading to a weaker tech sector, and a firm US dollar.GBP
The UK pound is lower with little upbeat news besides today’s Putin story to support it. There is a full calendar this week of UK economic news.EUR
The euro is slightly lower on the back of a broad-based firm US dollar even as the upbeat Russia news inspired some euro buying. Traders await a large docket of economic data out of the eurozone this week. The slight hawkish turn by the ECB is expected to support the euro, but more gradually over the year than quickly in the near-term.CAD
The Canadian dollar is weaker on the back of higher US Treasury yields and soft oil prices. There is no economic data, but CPI on Wednesday will be watched closely.ASIA/PACIFIC
The Japanese yen moved little versus the dollar, but outperformed most other currencies from its role as a safe haven, a sign that the Russian-Ukraine crisis is not over.
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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