ECB call emergency meeting on bond market; Fed could accelerate tightening to steepest rate since 1994; BoE faces pressure from weak pound and hawkish fed.
June 15, 2022
GBP/USD 1.2034 GBP/EUR 1.1493 EUR/USD 1.0471 USD/CAD 1.2969 EUR/CHF 1.0458 EUR/SEK 10.6195 EUR/NOK 10.4544 EUR/DKK 7.4393 USD/ILS 3.4505 AUD/USD 0.6907 NZD/USD 0.6219 USD/SGD 1.3911 USD/JPY 134.75 USD/CNH 6.7293 USD/INR 78.0775 EUR/ILS 3.6129 GBP/ILS 4.1524 USD/ZAR 16.0108
The BoE is facing a difficult task in balancing borrowing costs, with high recession risk. However, a weakening pound, and an increasingly hawkish Fed could pressure the BoE to hike further.
The UK Government was forced to cancel its first deportation flight following intervention from the European court of human rights.
GBPUSD slipped below 1.21 yesterday finding fresh yearly lows, as weak economic data and potential policy divergence from the Fed added to sterling weakness.EUR
The ECB is to hold an emergency meeting today to discuss borrowing turmoil, as borrowing costs for the bloc’s most indebted countries have risen to 8-year highs.
Euro-area industrial production may have risen 0.5% in April after contracting 1.8% in MarchUSD
Expectations are building around a 0.75% hike from the Fed, which would be the steepest tightening since 1994. The Fed is scrambling to keep up with surging inflation, following May’s shock CPI print. The FOMC might be hoping that faster tightening could restore market confidence.
US Retail sales are seen marginally advancing against last month, consensus sees 0.7% growth.ASIA/PACIFIC
China’s economy has showed a mixed recovery in May. Industrial production unexpectedly increased while the property market continues to slump, and consumer spending declined.
Australia’s June consumer sentiment, dropped 4.5% to 86.4, marking 7 straight months of sentiment decline.ILS
USDILS trades 0.4% lower as we print, trading roughly 3% higher through June.Data & Events
FOMC Rate Decision
France May CPI
Trading in financial instruments may involve a high degree of risk and may not be suitable for all investors. Trading in financial instruments can result in both loss and profit. Investors should carefully consider whether financial instruments suit their needs, financial resources and personal circumstances.
The information contained in this material is solely for informational purposes only and it is not and should not be construed as an offer or a solicitation of an offer to buy or sell any financial instruments and cannot be relied upon as a representation that any particular transaction necessarily could have been or can be effected at the stated prices. This material does not contrue advice.
For more analysis on FX markets or information regarding SVB's FX services:
0800 023 1440 from within the UK
+44 207 367 7880 from overseas
See all of SVB's latest FX information and commentary.
© 2023 SVB Financial Group. All rights reserved. SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license. 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).
Silicon Valley Bank is registered in England and Wales at Alphabeta, 14-18 Finsbury Square, London EC2A 1BR, UK under No. FC029579. Silicon Valley Bank is authorised and regulated by the California Department of Business Oversight and the United States Federal Reserve Bank; authorised by the Prudential Regulation Authority with number 577295; and subject to regulation by the Financial Conduct Authority and limited regulation by the Prudential Regulation Authority. Details about the extent of our regulation by the Prudential Regulation Authority are available from us on request. Silicon Valley Bank is a subsidiary of SVB Financial Group, a Delaware corporation and is an affiliate of SVB Financial Group UK Limited. SVB Financial Group UK Ltd is registered in England and Wales at Alphabeta, 14-18 Finsbury Square, London EC2A 1BR, UK under No. 5572575 and is authorised and regulated by the Financial Conduct Authority, with reference number 446159. SVB Financial Group and its subsidiary Silicon Valley Bank are members of the Federal Reserve System and Silicon Valley Bank is a member of the FDIC.
Your eligible deposits with Silicon Valley Bank UK are protected up to a total of £85,000 by the Financial Services Compensation Scheme, the UK's deposit guarantee scheme. Any deposits you hold above the limit are unlikely to be covered. Please click here for further information or visit http://www.fscs.org.uk. For more detailed information about coverage and limits, please review our FSCS Information Sheet at http://www.fscs.org.uk.
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, accounting and other advisors, and only make investment decisions on the basis of your own objectives, experience and resources. Opinions expressed are our opinions as of the date of this content only. The material is based upon information which we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon as such.