Economic paralysis deepens, as virus deaths top 2,000. Weak German sentiment sent the euro versus the dollar to 3 year low.
Investors are worried about a deepening economic fallout from the coronavirus. Thus, on Wednesday, the dollar stood tall over the weak euro and slowly sold exporter currencies.
In China, the new coronavirus has caused 2,004 deaths. It has infected more than 74,000. Moreover, the measures to contain the virus have paralyzed the economy and the supply chains it feeds.
Apple Inc already warned that it is most probably miss its march quarter sales guidance. It is because of disrupted production and shopping habits. Carmakers remain dead plants for lack of parts.
Chris Weston is head of research at Melbourne brokerage Pepperstone. He said that the market tries to model itself based on coronavirus. It struggles hard for understanding how that goes, and that’s pushing capital into the United States.
Over the night, the yield curve between United States three-month bills and 10-year notes inverted. It is a bearish economic signal. As its economy stagnates, the German investor confidence slumped. Thus, the euro was sent cheaper than $1.08 for the first time since 2017.
He adds that under current circumstances, the United States remains as the least-dirty T-shirt. Thus, it is the best house in a reasonably shabby-looking neighborhood. It is still the light that everyone looks for as a destination for capital.
The dollar is sitting by a four-month high against a basket of currencies at 99.452. Against the Australian and New Zealand dollars, it touched a one-week high overnight.
Both antipodean currencies are very much exposed to China. Both of them have lost against the dollar roughly 5%. Norway’s krone is sensitive to the global growth outlook via oil exports. It has shed 6% in 2020 and slumped to an 18-year low overnight. that are leading news of the market.
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