Busy FX markets ahead of today's Fed meeting
FX volatility for many of the major currencies hit multi-month highs overnight as traders anticipate an announcement from the Fed later today. The US dollar steadied while commodity-linked currencies were supported by higher oil prices.
“Life starts all over again when it gets crisp in the fall.”
September 22, 2021
EUR/USD 1.1731 GBP/USD 1.3626 USD/CAD 1.2794 AUD/USD 0.7250 USD/JPY 109.55 USD/CNH 6.4685 USD/ILS 3.2045 USD/MXN 20.0925 USD/CHF 0.9225 USD/INR 73.8685 USD/BRL 5.2705 USD/SGD 1.3517 USD/DKK 6.3385 USD/SEK 8.6770 USD/NOK 8.6375
FX trading was active overnight, but the US dollar is currently only slightly changed from yesterday's close. Traders are adjusting positions ahead today's Fed meeting, with anticipation that its policy language could turn more hawkish.GBP
Sterling is trading lower on broad currency trends. Overnight volatility for the currency hit levels not seen since March, adjusting pricing for both the upcoming Fed and Bank of England meetings this week.EUR
Overnight volatility for EUR/USD rose above 10% for the first time since July, ahead of the Fed’s decision later today. Traders are looking for more clarity from the US central bank regarding its plans for tapering.CADThe Canadian dollar strengthened as commodity prices traded higher. One-day volatility for the loonie soared to 20.40% which was the highest level since November ahead of the Fed meeting later today.ASIA/PACIFIC
The Japanese yen weakened against its peers following statement from the Bank of Japan signaling it will hold its key stimulus tools in place due to the recent pressures on the economy.
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/trends-insights/foreign-exchange-advisory
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.
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. Please add us to your trusted list of senders, contacts or address book.
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.
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.