ForexLive Americas FX news wrap for April 9, 2020:
- Fed unleashes plan for $2.3 trillion in lending programs
- Eurogroup reaches deal - report
- OPEC will cut even if G20 doesn't - report
- Canada March employment -1010K vs -500K expected
- US initial jobless claims 6606K vs 5500K
- Boris Johnson taken out of ICU ward
- Baker Hughes US oil rig count 504 vs 562 prior
- UK reports 881 virus deaths vs 938 a day ago
- Italy reports a growing number of new case and deaths on 1 month anniversary of lockdown
- New York state coronavirus deaths 799 yesterday vs 779 yesterday
- Trudeau: Canada won't return to normal until there is a vaccine
- Fed's Powell: Unemployment likely to temporarily rise very high
- US wholesale inventories for February (F) -0.7% versus -0.5% estimate
- Michigan consumer sentiment for April (P) 71.0 versus 75.0 estimate
- US PPI final demand YoY 0.7% versus 0.5% estimate
Markets:
- Gold up $38 to $1684
- WTI crude oil down $1.60 to $23.48
- US 10-year yields down 5.3 bps to 1.72%
- S&P 500 up 40 points to 2789
- AUD leads, USD lags
It was another wild day. Coming in we were watching OPEC and jobless claims but the Fed stole the show early by announcing a huge lending program. That cut down the US dollar across the board and sent gold as high as $1690. It also reversed a slump in US stock futures.
The dollar was soft throughout the day, particularly against the yen, euro and antipodeans. USD/JPY was flat through early European trading but slumped on the break of 108.70 and continued the fall all the way to 108.20 before a late 25 pips bounced as stocks rebounded to finish green.
EUR/USD rose to the highs of the week at 1.0952 but it remains right in the middle of the four week range as the market tries to sort out what's coming next.
There is consolidation on so many charts right now and you have to wonder if we're waiting for some kind of jolt in either direction.
One spot that has pulled decidedly higher is AUD/USD, which gained every day this week and is at the best level since March 12. The virus appears to be hitting Australia gently and the government stimulus has been extraordinary. It all adds up to an impressive rebound to 0.6342 from 0.5500.
USD/CAD meanwhile has been reluctant to break the late March low of 1.3922. It look another look today but couldn't get through as oil surged to $28. The reversal lower in oil doomed hopes for a break but the loonie held tough to finish at 1.3967.
It was a similar story in cable. We celebrate the good news on Boris Johnson but sterling couldn't find the strength to climb above 1.2486, which is the recent high. The case numbers in the UK will be closely followed on the weekend but be warned that the Sunday numbers have been unreliable lately and that might extend to a holiday weekend.
Have a great long weekend. We're going to continue posting a few tidbits but will also be taking a break.
