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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.
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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
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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.
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