Tuesday 20 August 2019 Sterling/Euro Exchange Rate Quiet ...

Morning Comment

AIB Treasury Economic Research Unit

Tuesday 20 August 2019 07:24 am

Quiet 24 hours on the FX front

Compared to the start of the previous two weeks, risk appetite

commenced this week on a firmer footing. The lack of any further 1.15

escalation in the US/China trade dispute and news that Germany was considering a fiscal stimulus package for its economy helped 1.14

to create a more supportive backdrop. 1.13

Euro/US Dollar Exchange Rate

The improvement in investor sentiment was reflected in gains for 1.12

equity markets on both sides of the Atlantic. In Europe, the Euro

Stoxx 50 gained 1.2%. Meanwhile, at the closing bell on Wall Street 1.11 last night, the S&P 500 was also up 1.2% on the day. Given the

more positive tone to risk appetite, there was reduced demand on 1.10

bond markets. This was reflected in rising bond yields.

20-Feb 20-Mar

17-Apr 15-May 12-Jun

10-Jul

07-Aug

On the currency front, the action over the past 24 hours has been confined to fairly tight ranges. The very sparse macro data 0.94

calendar meant there was little to be of influence on the main 0.92 currency pairs. Of the limited moves to register, sterling is slightly

lower over the period.

0.90

Euro/Sterling Exchange Rate

As trading gets underway this morning, EUR/GBP remains in the lower half of the 91-92p band, while EUR/USD opens once again below the $1.11 level. Meantime, GBP/USD is changing hands within the $1.21-1.22 trading range.

Looking ahead to today, it is another sparse diary in terms of macro data or events. Indeed, both the Eurozone and US schedules contain no releases of any note. As a result, EUR/USD could continue to operate in a tight range near its current level. Elsewhere, the only calendar highlight in the UK is the CBI industrial orders data for August. From a sterling viewpoint, this data may not garner much attention. However, the currency remains sensitive to Brexit newsflow. John Fahey, Senior Economist, AIB

Today's Opening FX Rates

% Change

EUR/USD EUR/GBP GBP/USD GBP/EUR USD/JPY EUR/JPY

1.1079 0 . 9142 1.2118 1.0934 106.46 117. 96

Day * -0 . 11 0.20 -0 . 3 0 -0 . 20 0 . 12 0.01

End 2018 -3 . 40 1.76 -5. 0 1 -1.73 -2. 83 -6.16

* v Previo us Day's Euro p ean Op en

See Next Pag e f o r M o re Rat es

USD EUR GBP

Base Rate 2.125 0.00 0.75

Opening Interest Rates

Short Term

1-Mth

3-Mth 12-Mth

2.17

2.15

1.95

-0.42

-0.42

-0.39

0.71

0.77

0.87

Long Term

2-Yr

5-Yr

1.53

1.40

-0.55

-0.52

0.71

0.65

All rates quoted are indicative market rates

0.88

0.86

0.84 20-Feb

1.34 1.32 1.30 1.28 1.26 1.24 1.22 1.20 1.18

20-Feb

1.18 1.16 1.14 1.12 1.10 1.08 1.06

20-Feb

20-Mar

17-Apr

15-May

12-Jun

10-Jul

07-Aug

Sterling/US Dollar Exchange Rate

20-Mar

17-Apr

15-May

12-Jun

10-Jul

07-Aug

Sterling/Euro Exchange Rate

20-Mar

17-Apr

15-May

12-Jun

10-Jul

07-Aug

See Next Page For More Rates & Charts

FX Spot

Karl Cooke Shane Gargan Enda Homan

FX Options

Mark Tuite Lenny Hogan

Equity Options Gary Luff

Reuters AIBI Phone 00353-1-7724018

Morning Comment John Fahey john.j.fahey@aib.ie

All Data Sourced from Refinitiv

Opening Levels

Tuesday 20 August 2019 07:24 am

Euro

EUR/GBP EUR/USD EUR/JPY EUR/SEK EUR/DKK EUR/NOK EUR/CHF EUR/AUD EUR/HKD EUR/CAD

0.9142 1.1079 117.96 10.7306 7.457 9.944 1.0864

1.632 8.6904 1.4753

Sterling

GBP/EUR

1.0934

GBP/USD

1.2118

GBP/CAD

1.6135

GBP/NZD

1.886

GBP/JPY

129

GBP/SEK

11.7339

GBP/DKK GBP/NOK

8.154 10.8705

GBP/CHF

1.188

GBP/AUD

1.7849

Dollar

USD/JPY USD/CAD USD/CHF USD/CNY USD/BRL USD/RUB USD/INR

106.46 1.3313 0.9803 7.0621 4.0747 66.815 71.575

AUD/USD NZD/USD

0.6789 0.6422

Dollar/Yen Exchange Rate

113

111

109

107

105

103 20-Feb

20-Mar

17-Apr 15-May 12-Jun

10-Jul

07-Aug

US Swap Curve

Offer Rates : Money Rates to 1 Year

2.40

2.20

2.00

1.80

1.60

1.40

1.20 1 Mth 3Mth 6Mth 1Yr 2Yr 3yr 4Yr 5yr 6Yr 7yr 8Yr 9Yr 10Yr

Latest Close

4 Weeks Ago

Eurozone Swap Curve

%

Offer Rates : Money Rates to 1 Year

0.2

0.0

-0.2

-0.4

-0.6

-0.8 1 Mth 3Mth 6Mth 1Yr 2Yr 3yr 4Yr 5yr 6Yr 7yr 8Yr 9Yr 10Yr

Latest Close

4 Weeks Ago

Euro/Yen Exchange Rate

128

126

124

122

120

118

116 20-Feb

20-Mar

17-Apr

15-May

12-Jun

10-Jul

07-Aug

UK Swap Curve

Offer Rates : Money Rates to 1 Year

1.10

1.00

0.90

0.80

0.70

0.60

0.50 1 Mth 3Mth 6Mth 1Yr 2Yr 3yr 4Yr 5yr 6Yr 7yr 8Yr 9Yr 10Yr

Latest Close

4 Weeks Ago

% 1.00 0.80 0.60 0.40 0.20 0.00 -0.20 -0.40 -0.60 -0.80 -1.00

15-Feb

Irish & German 10-Year Bond Yields

15-Mar 15-Apr 15-May Irish 10 Year

15-Jun 15-Jul German 10 Year

15-Aug

Debt Markets

Close

Day

Change bps 4 Weeks End 18

10 Year Yield % US Germany UK

1.61 -0.65 0.47

+5

-44

-108

+3

-31

-89

+1

-24

-80

Ireland Belgium France Italy Spain

-0.10 -0.32 -0.37 1.42 0.11

+6

-19

N/A

+5

-29

-108

+4

-28

-107

+2

-23

-129

+4

-26

-130

Portugal

0.15

+4

-31

-156

Greece

2.00

+7

-7

-229

-------------------------------------------------------------------------------------------

5 Year Swap %

US

1.39

+0

-38

-117

Eurozone

-0.50

+5

-20

-73

UK

0.63

-2

-15

-68

-------------------------------------------------------------------------------------------

2 Year Swap %

US

1.54

+5

-28

-110

Eurozone

-0.54

+3

-10

-40

UK

0.70

-3

-3

-47

-------------------------------------------------------------------------------------------

10 Year Government Bond Spreads to Benchmark bps

Ireland

56

+2

+12

N/A

Belgium France Italy Spain

33

+1

+1

-19

28

+1

+2

-18

208

-2

+8

-40

76

+0

+4

-41

Portugal Greece

Brent Oil West Texas Oil

80

+1

+0

-67

266

+4

+24

-140

Commodities

% Change

Close 59.74 56.24

Day 4 Weeks +1.88 -5.56 +2.57 +0.66

End 18 +11.04 +24.56

Gold $

1495.6 -1.25 +4.92 +16.58

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