Demand for safe havens slide and commodity-linked currencies rise
Amid signs that the fatality rate in Spain, Italy and France are slowing, demand for risk-sensitive commodity currencies rose and outperformed against safe havens.
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April 6, 2020
EUR/USD 1.0776 GBP/USD 1.227 USD/CAD 1.4163 AUD/USD 0.6070 USD/JPY 109.06 USD/CNH 7.1102 USD/ILS 3.6080 USD/MXN 24.9725 USD/CHF 0.9790 USD/INR 75.96
After rising half a percent in early trading, the dollar pared gains as risk appetite returned and commodity currencies gained. The greenback is up 0.1%.GBP
Sterling initially gave up 0.5% following news that Boris Johnson was taken to this hospital as he fights the coronavirus. A return in risk appetite on evidence of slowing coronavirus spread throughout Europe allowed the pound to recoup losses and gain 0.2% versus the dollar.EUR
After a week-long decline, the euro is finding stability around the 1.08 level. Signs of a slowing virus death rate in the eurozone have returned some optimism to markets.
European leaders are set to meet tomorrow to reach consensus for an EU-wide bailout. Spain is said to be rolling out Universal Basic Income soon.CAD
Oil prices pared losses of nearly 11% and are posting a net price increase amid signs that Saudi and Russia are making progress on an agreement to curb oil output. The loonie advanced on higher oil prices and increased risk appetite.ASIA/PACIFIC
A slip in safe haven demand dropped the yen as PM Shinzo Abe rolled out a two phase stimulus package which will put Tokyo and six other economic hubs in a state of emergency. The USD/JPY pair climbed as high as 1.0938 – a two week high.
The Australian dollar led G-10 advances versus the dollar gaining as much as 1.3% to 0.6076.
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