Foreign Exchange Market Update
May 25, 2017
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
In the United States, Exports of goods fell 0.9 percent in April from the previous month; imports rose 0.7 percent. Outbound shipments were depressed by a 7.5 percent slump in motor vehicles and a 4.1 percent drop in consumer goods. Imports of consumer merchandise, food and capital goods increased in April. Inventories at motor vehicles and parts dealers fell 0.5 percent; excluding autos, retail stockpiles were down 0.2 percent. Wholesale inventories of durable goods fell 0.2 percent; stocks of nondurable goods declined 0.6 percent. Exports and imports of goods accounted for about three-fourths of America’s total trade in 2016; the U.S. typically runs a deficit in merchandise trade and a surplus in services
Euro is trading at 1.1217 as of 9:42 am PST. The euro hit a six-month high against the dollar this week and is on track to be the top-performing currency in the Group-of-10 in the first half of the year. Defeat for anti-euro candidates in the Dutch and French elections, better-than-expected regional economic data and increasing fund inflows into euro-zone equity markets are all making investors more confident on the outlook.
British pound is trading at 1.2957 as of 9:50 am PST. The UK economy slowed sharply as rising prices in the wake of the Brexit vote took their toll on consumer spending. The Office for National Statistics said GDP grew just 0.2% in the first quarter of 2017, a marked change of pace from the 0.7% growth in the final three months of 2016. Statisticians had previously estimated the economy grew 0.3% in the first quarter. There was no growth at all in the first quarter in GDP per head, which adjusts for the size of the population and is generally seen as a better guide to prosperity than mere GDP.
Canadian dollar is trading at 1.3450 as of 9:37 am PST. The drop in oil dragged Canadian dollar away from its earlier 5-week high per US dollar.
Other commodity currencies also came under pressure, with the Australian dollar being one of the worst performers. The Australian dollar was down 0.4% versus the US dollar as a fresh plunge in iron ore prices this week threatens to undo the currency’s solid gains over the past two weeks.
New Zealand dollar is trading at 0.7044 as or 9:38 am PST. A bigger-than-expected government surplus in New Zealand has boosted the New Zealand dollar recently as it bodes well for economic growth. The government plans to use the extra funds to undertake a massive infrastructure spending program.
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.