Forex Today: King Dollar takes back the reins as coronavirus fears mount, oil slumps; eyes on German CPI
|Here is what you need to know on Monday, March 30:
The haven demand for the US dollar is back in play starting out a fresh week, allowing the greenback to recover some ground after last week’s plunge, although S&P 500 futures are rebounding and therefore, suggesting limited upside.
The optimism spurred by the US $2 trillion stimulus and global relief measures deployed to fight the coronavirus pandemic fades, as investors remain worried about the intensifying virus spread and mounting global recession fears, with lockdowns announced by most governments.
See:
- Is a US recession inevitable? What does the history of consumer sentiment tell us?
- Will U.S. Dollar Rebound After Rough Week?
USD/JPY fell sharply towards 107.00, as the safe-haven yen drew bids amid falling Asian stocks and Treasury yields, although the losses were capped broad US dollar rebound. However, EUR/USD and the cable suffered the most, correcting last week’s surge. EUR/USD dropped back below 1.1100 ahead of the German Preliminary CPI report while GBP/USD surrendered the 1.24 handle.
Meanwhile, the Australian and New Zealand dollars also slipped against the greenback, despite the Chinese central bank’s surprise Repo rate cut. The Canadian dollar traded with sizeable losses, as oil prices slumped, with pandemic fears denting the oil demand outlook.
Coronavirus spread intensifies so does the economic risk around the world, with nearly 34,000 deaths reported. The US has emerged as the latest epicenter, with more than 137,000 cases and 2,400 deaths and lockdowns are toughening worldwide. US President Trump backtracked on its plans to re-open the economy by Easter, instead, he extended the social distancing guidelines until April 30. Across the Atlantic, Italy’s death toll is now the highest in the world at 10,023, Spain’s fatalities continue to climb while the UK warned of a six-month lockdown as New York state death toll tops 1,000.
Gold has come under heavy selling pressure and now heads back towards $1600 mark.
Cryptocurrencies are attempting a minor recovery after the weekend slump, with Bitcoin trading around $6,200.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.