April 28, 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
United States (US) Economic growth decelerated in this first estimate of 2017 1st Quarter GDP, confirming projections made by the Atlanta Fed that consumption grew at just 0.3% in the 1st quarter due to slower auto sales and slower growth in electricity consumption, a part of the "services less food" component of consumption. While this initial report suggests the 1st Quarter was the slowest in 3 years, the economy has been growing for the past 28 quarters at an average annualized growth rate of 2.3%. Given the components of consumption that led the decline, there is reason to expect some rebound in the 2nd Quarter. On another note, Employment Cost Index rose by 0.8% during the 3 months ended in March 2017, compared with market expectations for an increase of 0.6%. Wages and Salaries rose by 0.8% and are now 2.5% above their year ago level. Since late 2009, wage growth had flattened out at a very weak rate but is now rising modestly. Wages and salaries account for approximately 70% of total employment costs. On the last note, Manufacturing activity in the Chicago region expanded moderately in April to 58.3%. While stronger than expected with new orders nearly hitting a 3-year high, most regional manufacturing surveys suggested a slight deceleration in the pace of manufacturing growth in April. That would be consistent with current consensus estimates that suggest the national ISM due Monday will fall to 56.5 from 57.2.
Euro traded at 1.0905 against USD at 10:48 am PST. French presidential candidates Marine Le Pen and Emmanuel Macron are seeking to expand beyond their own political bases as the nation’s hard-fought presidential contest shifts into its final 10 days. At a rally in the Mediterranean city of Nice late Thursday, Le Pen avoided mentioning her plan to pull out of the euro and attacked Macron for lacking French values in an appeal to supporters of conservative candidates who were defeated in the first round of voting Sunday. Macron, meanwhile, was in a 1-1/2 hour television interview in which he promised not to interpret votes from backers of other parties as a “blank check” and suggested to the country that not voting helped his rival.
British Pound exchange rate is 1.2963 against USD at 10:48 am PST. The pound shrugged off slower-than-forecast economic growth in the U.K. to head for its biggest monthly advance in a year. Gross domestic product rose 0.3% in the first quarter from the prior three months, less than the 0.4% median estimate of economists surveyed by Bloomberg and the slowest growth in a year. Still, the currency held above $1.2900 and was set for its second monthly advance against the dollar after Prime Minister Theresa May announced a snap election for June on April 18.
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.