US dollar rallies to highest levels in 3 years on fear of liquidity crunch

Investors move to the US dollar as anxiety around a global liquidity crunch intensify. Equity trading stopped abruptly in India and Indonesian following steep declines and bond trading seized up in Australia, Japan and South Korea. The fear is that as the coronavirus spreads, factories will suffer and stunt investment growth.

“Bad news: a lot can change in 30 days. Good news: a lot can change in 30 days."
Rachel Hollis
  • FX Rates
    March 13, 2020

    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.


  • USD
    The US dollar climbed over 1% yesterday, hitting levels not seen in 3 years. This comes at a time when traders are moving to safe haven assets.
    GBP
    Sterling is trading below the 1.2500 handle as the US dollar gains across the board. The currency pair has surpassed yesterday’s low and is trading at levels not seen since October.  
    EUR
    EUR/USD is trading below the 1.12 handle. There is technical support seen at 1.1100 ahead of the 55-dma at 1.1059.
    CAD

    Canadian policy makers are increasing efforts to strengthen confidence in the economy. The central bank states they would send cash into funding markets and fiscal stimulus could also follow. Prime Minister Justin Trudeau is now in isolation after his wife tested positive for Covid-19.

    ASIA/PACIFIC
    USD/JPY moved as much as 2.4% higher on the broad dollar strength. The dollar held strength against the JPY following a pledge from the BoJ to keep liquidity plentiful.
    AUD/USD rallied almost 1% following an announcement from RBA that they are adding AUD$8.8bn to the daily repurchase operations.
Contact Us

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 privacy@svb.com. You can withdraw your consent at any time.

Cate Camerota
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.

FX Daily Update: US dollar steady amid quarter-end flows

 

Daily FX Update: GBP outperforms peers ahead of Brexit negotiations

 

Daily FX Update: Dollar higher, equities lower to end another risk-off week

 

Daily FX Update: Dollar firm, equities lower in risk-off mood

 

Daily FX Update: Fourth consecutive day for dollar rally

 

Daily FX Update: Risk sentiment keeps FX market on edge