The PBOC calmed markets with an unaggressive daily currency fix
Scott Petruska, CFA | August 8, 2019
Financial markets were calmed by the People's Bank of China setting the daily USD/CNY fixing lower and less aggressively than analysts had expected. Asian and European stocks rose overnight, and bond yields edged higher. At the same time, the White House is preparing to place tariffs on $300 billion of Chinese imports on September 1. Oil prices jumped after Saudi Arabia contacted other producers to stem the fall in prices. Currency markets were little changed.
“Remember that the storm is a good opportunity for the pine and the cypress to show their strength and their stability.” Ho Chi Minh |
-
FX Rates
August 8, 2019Rates 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 1.1196 GBP/USD 1.2113 USD/CAD 1.3301 AUD/USD 0.6788 USD/JPY 106.18 USD/CNH 7.0733 USD/ILS 3.4769 USD/MXN 19.5951 USD/CHF 0.9772 USD/INR 70.6975
-
USD
The dollar made slight gains overnight, reversing this week’s sell-off which had been triggered by the unexpected move in the Chinese yuan past the key RMB 7 per USD level on Monday. The dollar’s biggest gain was against the Japanese yen, which has benefited as a safe haven currency.
GBPThe UK pound moved little overnight, even after UK PM Boris Johnson said he fully expects to face a confidence vote after parliament returns from its summer recess.
EURLittle change in the euro was seen overnight as markets were calmed by the PBOC and there were no key EU economic data releases.
CADThe Canadian dollar edged higher overnight. Oil prices had jumped when a Saudi official said that they had phoned other oil producers to halt oil’s slide in prices.
ASIA/PACIFICEven after the US officially labeled China a “currency manipulator” early in the week, China has been unaggressive in its response. It set this morning’s USD/CNY reference rate at 7.0039 yuan per dollar, the weakest level since 2008, but lower than market expectations. The currency pair is trading near 7.0450, as traders are still bullish.
INRThe Indian rupee reversed a five-day losing streak against the dollar following reports that India will roll back a tax surcharge on foreign portfolio investors. The USD/INR dropped to 70.55 after reaching 70.98 yesterday.
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/foreign-exchange
Subscribe to receive the Daily FX Update in your inbox.
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 Policy. If you have privacy questions, you may contact us at privacy@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. We also suggest you whitelist the svb.com domain.
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.
Source: Bloomberg | |
This article is intended for U.S. audiences only. ©2019 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of 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. |