Sterling breaks above 1.40 on vaccine optimism

Cate Camerota

February 19, 2021

Sterling breaks above 1.40 on vaccine optimism

GBP/USD soared to levels not seen since April 2018 holding within the 1.40 handle as investors are optimistic that the rapid roll-out of Covid vaccinations will support a reopening of the economy. The US dollar continues to weaken against its peers trading down 0.3% for the day.

“When you’re young you’re encouraged to try new things. At a certain age, nobody says that to you anymore. If you’re lucky enough to be alive, why not say yes to all of it at any age?”

Mary Steenburgen

FX Rates
February 19, 2021

Rates 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

1.2122

GBP/USD

1.4011

USD/CAD

1.2625

AUD/USD

0.7855

USD/JPY

105.52

USD/CNH

6.4537

USD/ILS

3.2737

USD/MXN

20.3862

USD/CHF

0.8954

USD/INR

72.6512

USD/BRL

5.4014

USD/SGD

1.3244

USD/DKK

6.1362

USD/SEK

8.2809

USD/NOK

8.4489

USD
The dollar index is trading lower for the second day ahead of US President Joe Biden’s speech at the G7 conference. Biden is expected to outline the nation’s new foreign policy.
GBP
Sterling broke through the psychological 1.40 level for the first time since 2018. This move higher comes as investors are optimistic that the vaccine rollout will support a recovery in the economy this year.
EUR
EUR/USD is trading higher following data out of Germany that signaled manufacturing PMI beat estimates.
CAD
USD/CAD is down 0.6% hitting a low of 1.2605 and on track for a weekly drop close to 1%. The Canadian dollar is largely supported by stronger risk appetite and higher oil prices.
ASIA/PACIFIC
The Australian dollar surged against all of its G10 peers following comments from Westpac Banking Corp Economist increased his forecast for the country’s 10-year bond yield. USD/JPY is hovering around the psychological level of 105.50.

For more analysis on FX markets or information regarding SVB's FX services:

Contact your respective SVB FX Advisor or the SVB FX Advisory Team at fxadvisors@svb.com.
See all of SVB's latest FX information and commentary at www.svb.com/trends-insights/foreign-exchange-advisory

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 Notice. If you have privacy questions, you may contact us at PrivacyOffice@svb.com. You can withdraw your consent at any time.

Source: Bloomberg

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.

WRITTEN BY

Cate Camerota

Insights from SVB Industry Experts

SVB experts provide our customers with industry insights, proprietary research and insightful content. Check out these related articles that may be of interest to you.

Markets pause, equities and dollar mixed

Scott Petruska, CFA

Global bond yields soften driving risk-on equity buying, dollar is mixed

Scott Petruska, CFA

Nervous bond market helps dollar

Peter Compton

Daily FX Update: Dollar selling resumes

Peter Compton

Daily FX Update: Pound and dollar stronger on improved economic outlook

Peter Compton

Daily FX Update: Dollar gains as Tech stocks take a hit

Peter Compton