Let’s check the Market. As China markets stumble on virus scare, Yuan and Aussie are on the back foot.
Virus uncertainty supports yen and franc.
After the Lunar New year break, China’s share market reopened with significant losses. Thus, on Monday, the yuan and its proxy, the Australian dollar, were on the defensive. Investors kept guard because of the anxiety over a virus outbreak in the country.
The 10-day break was extended to help curb the epidemic. After that, Chinese shares tumbled. Chinese share futures and Exchange Traded Funds (ETFs) traded outside China indicated falls in line.
Authorities have taken vital steps worldwide to stop the epidemic. Nevertheless, the reaction in currency markets is limited.
China and Epidemy
Travel curbs and business shutdowns hit many parts of China. The Hubei province is ground zero of the epidemics. On Monday in Hubei, the death toll rose by 56 to 350.
United States, Singapore, and Australia are among countries that have banned entry by foreign nationals who have recently visited China.
Masashi Hashimoto is a senior currency analyst at MUFG Bank. He said that the number of new patients is rising very fast. Nevertheless, the virus turns out not to be that severely pathogenic, but the movements of goods and people will most probably be restricted for the time being.
It will, for sure, pour cold water on signs of the rebound in the Economy of China we saw since December.
The offshore yuan eased by 0.1%. Per dollar, it hit a month low of 7.0117. Nevertheless, its onshore indicator fell over 1% from its levels before the holiday to 7.0125 per dollar.
The Australian dollar was indicating at $0.66925. It was slightly up on the day. Nevertheless, it was precariously close to its 10-1/2-year low of $0.6670 touched last October.
It is the changes that happened today in the market.
