Forex news from the European trading session - 1 April 2020
Headlines:
- There is said to be no discussions for a 'Phase 4 stimulus' in the White House
- European Commission proposes new short-time work scheme to help with virus fallout
- Japan to seek to quarantine all overseas arrivals for 14 days
- Spain exceeds 100,000 virus cases, reports another 864 deaths from the disease
- Saudi Aramco oil supply has surged above 12 mil bpd - industry official
- UK March final manufacturing PMI 47.8 vs 48.0 prelim
- Eurozone March final manufacturing PMI 44.5 vs 44.8 prelim
- Italian health minister confirms lockdown measures to be extended until 13 April
- Tokyo said to report 66 new coronavirus cases today
- Japanese economy minister insists no need to declare state of emergency now
- China president Xi says to ensure economic, trade activites return to normal
- RKI reports 67,366 coronavirus cases in Germany, up by 5,453 cases from yesterday
Markets:
- USD, JPY leads, CAD lags on the day
- European equities lower; E-minis down 3%
- US 10-year yields down 5 bps to 0.62%
- Gold up 1% to $1,593
- WTI up 0.8% to $20.65
- Bitcoin down 2.7% to $6,306
It was a somewhat calmer session as the European traders welcomed the new month and new quarter by dipping their toes into the red sea, as equities were sold off heavily.
The risk mood was already softer in Asia Pacific trading but intensified just before the start of the European morning, with Japan's Nikkei falling by 5% at one stage near the close.
US futures fell by over 3% and kept around those levels during the session, with the mood translating over to European equities as they see heavy declines across the board.
As such, that helped to underpin both the dollar and the yen with EUR/USD falling to 1.0917 from 1.1010 levels, while USD/JPY stayed rangebound around 107.40-60.
Meanwhile, risk currencies suffered with AUD/USD easing from 0.6120 to 0.6052 and USD/CAD rising from 1.4100 to test its 200-day moving average at 1.4240-50 levels currently.
With re-balancing flows now out of the picture, investors can now focus back on virus headlines and the continued economic fallout. So far, we are seeing more pessimistic tones but let's see how Wall Street will respond once they take to the stage later today.
