Foreign Exchange Market Update
June 19, 2018
Indicative Interbank spot sell rates only as of 9:00 AM PST.
PLEASE CALL THE FX DEPARTMENT AT (626) 279-3235 FOR THE MOST CURRENT RATE
USD/CNY 6.4854 (onshore)
United States (US): Housing Starts
Housing starts spiked by 5.0 percent to an annual rate of 1.350 million in May after tumbling by 3.1 percent to a revised rate of 1.286 million in April. Meanwhile, building permits plunged by 4.6 percent to an annual rate of 1.301 million in May after falling by 0.9 percent to a revised rate of 1.364 million in April.
Australia: RBA Minutes, Consumer Confidence, Q1 House Price Index
Australian dollar traded at 73.78 U.S. cents at 10:36 am PST
The Reserve Bank of Australia will on Tuesday release the minutes from its monetary policy meeting on June 5, highlighting a light day for Asia-Pacific economic activity. At the meeting, the RBA left its key interest rate unchanged at a record low 1.50 percent for the 20th consecutive meeting. Australia’s consumer confidence index dropped to 122.1 from 123.0 in the preceding week. However, the index remained comfortably above its long-term average. Residential property prices in Australia fell 0.7 percent on quarter in the first three months of 2018. On a yearly basis, house prices climbed 2.0 percent - again exceeding expectations for an increase of 1.7 percent after spiking 5.0 percent in the three months prior.
European Union: Rate Hike, Account Surplus, Construction Output
Euro traded at 1.1580 against USD at 10:39 am PST.
European Central Bank President Mario Draghi said the bank will remain patient in determining the timing of the first rate rise and will take a gradual approach to adjusting policy thereafter. At the governing council meeting last week, the ECB announced its plan to start exiting its massive quantitative easing by the end of this year.
The euro area current account surplus declined to a 10-month low in April. The current account surplus fell to EUR 28.4 billion in April from EUR 32.8 billion in March. This was the lowest surplus since June 2017. The surplus on goods trade totaled EUR 21 billion versus EUR 30.3 billion in the previous month. Meanwhile, the surplus on services rose to EUR 9.6 billion from EUR 9.4 billion.
Eurozone construction output advanced 1.8 percent month-over-month in April, reversing a revised 0.2 percent drop in March. Moreover, this was the sharpest rate of growth since February 2017, when output had risen 5.7 percent.
Onshore Chinese yuan traded at 6.4803 per USD at 10:45 am PST and offshore Chinese yuan traded at 6.4823 per USD.
China's central bank added more funds into the financial system on Tuesday after the US President Donald Trump threatened to impose a 10 percent tariff on an additional $200 billion of Chinese imports. The People's Bank of China added CNY 200 billion via medium-term lending facility on concerns over liquidity as well as negative impact from trade conflicts.
This market update is prepared by Cathay Bank for informational purposes only and does not constitute any form of legal, tax or investment advice, nor should it be considered an assurance or guarantee of future exchange rate movements or trends. This information is provided without regard to the specific objectives, financial situations or needs of any recipient. Cathay Bank does not make any representations or warranties about the accuracy, completeness or adequacy of this market update.