Forex Today: Cautiously optimistic on Brexit day; Eurozone data in spotlight

Dhwani Mehta FXStreet

Here is what you need to know on Friday, January 31:

Despite travel warnings issued by the US and Japan not to take trips to China amid fast-spreading coronavirus, the World Health Organization (WHO) confidence in China’s quick containment efforts and upbeat Chinese PMI reports reassured markets and buoyed the risk sentiment.

The death toll in China has now reached 213 and the number of confirmed cases is 9,692. It has spread to 18 countries.

Asian equities attempted a tepid recovery, tracking the uptick in the S&P 500 futures and solid rebound in the US Treasury yields. Consequently, USD/JPY spiked to 109.14 from 108.88 lows.

Most Asian currencies stalled their slide to multi-month lows but were not out of the woods yet. The Aussie jumped to 0.6729 while NZD/USD hovered below 0.6500. The Chinese yuan struggled to extend its recovery vs. the US dollar.

EUR/USD traded under pressure but held onto 1.1000 while GBP/USD consolidated BOE-led gains around the 1.31 region.

EZ inflation and GDP preview: Downbeat figures could trigger the next leg down for EUR/USD

Oil rebounded 2% on WHO’s conciliatory tone, as traders re-assessed coronavirus’ impact on demand for oil and its products.

Gold prices traded on the back foot below $1575 amid improved market mood, although remained on track for a monthly gain.

Cryptocurrencies fell back in the red, with Bitcoin trading sub-$9,400.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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