Fed hikes by 0.5%, rolling off the balance sheet; BoE expected to raise rates by 0.25%. Stocks climb as Powell downplays 0.75% hike.
-
FX Rates
May 5, 2022Rates 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.
Source: BloombergGBP/USD 1.2543 GBP/EUR 1.1834 EUR/USD 1.0600 USD/CAD 1.2750 EUR/CHF 1.0351 EUR/SEK 10.3351 EUR/NOK 9.8059 EUR/DKK 7.4411 USD/ILS 3.3781 AUD/USD 0.7226 NZD/USD 0.6517 USD/SGD 1.3777 USD/JPY 129.68 USD/CNH 6.6463 USD/INR 76.2150 EUR/ILS 3.5806 GBP/ILS 4.2371 USD/ZAR 15.5874
-
GBP
The Bank of England is expected to see rates rise to 13-year highs and clarify its plans to sell some of its £847 billion in government bond holdings. Swaps are pricing in 1.25% of further hikes by September.
GBPUSD trades lower -0.88% intraday, the FTSE100 has opened +1.45%, and despite the cost-of-living crisis, has outperformed European equities, up 3% YTD.
EURThe ECBs Fabio Panetta has stated that the European economy is de facto stagnating. Growth in the first quarter would have been zero without on-off growth spikes in a handful of nations.
Germany’s factory orders fell 4.7% MoM in March, a much steeper drop than forecasted, as Ukraine and a new Chinese covid wave triggers supply chain issues.
Spain and Portugal begin collaboration to cap the prices of natural gas used on the Iberian Peninsula.
USDThe Federal Reserve raised rates by 0.5% as expected and hinted at a series of same-sized moves to come. Jerome Powell eased concerns around a 0.75% hike. The Fed will allow Treasuries and MBS to roll-off in June at an initial monthly pace of $47.5 billion.
The DXY is 0.2% higher as we print. US equities closed higher following Powell’s comments downplaying the likelihood of radical tightening.
ASIA/PACIFICBiden’s strategy towards China is set to be outlined today. The address was delayed, and it is expected not to offer any major changes in US foreign policy.
The Yen could extend declines to 140 per dollar, by a fresh surge in Treasury yields.
ILSUSDILS touched 3.39 yesterday, the last 24 hours has seen high volatility for the cross, trading between 3.35 and 3.39Data & EventsBoE Rate Decision
US Weekly Jobless Claims
OPEC Meeting
UK PMI
Risk Statement
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.
| Source: Bloomberg | |
© 2022 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. |