Forex Today: Coronavirus weight on growth keeping investors on the back foot

FXStreet Team FXStreet

Here is what you need to know on Monday, February 17th:

US data released on Friday was mixed, with Retail Sales up by 0.3% but the core reading disappointing by holding flat, while Industrial Production fell in January. Michigan’s Consumer Sentiment jumped to 100.9 in February according to preliminary estimates, beating expectations and partially offsetting the negative headlines.
During the weekend, China reported that there were 68,500 cases of coronavirus, while the death toll rose to 1,669. A Chinese woman died in France, the first death reported in Europe. Concerns likely to keep the market in risk-off mode.
EUR/USD remained pressured and settled at its lowest since April 2017 as Germany Q4 GDP showed that the economy didn’t grow in the three months to December.
GBP/USD flirted with 1.300 but bounced, holding on to Cabinet reshuffle-related gains.
Gold prices benefited for increased demand for safety. Spot gold settled at $1,583.74 a troy ounce.
Crude oil prices edged higher at the end of the week, as Russian oil producers favour extending production cuts.
Cryptocurrency market update: Ethereum stands tall amid broad crypto correction

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FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

GBP/USD declines toward 1.3500 as markets turn risk-averse

GBP/USD comes under bearish pressure and declines toward 1.3500 on Tuesday. The UK ILO Unemployment Rate held steady at 4.9% in the three months to June, against a forecast of 4.8%, while Employment Change arrived at 83K in the same period versus 147K previous. Weak UK labor data, combined with the risk-averse market atmosphere amid a re-escalation of tensions in the Middle East weigh on the pair.

EUR/USD retreats below 1.1600 on modest USD recovery

EUR/USD struggles to gain traction and trades below 1.1600 in the second half of the day on Tuesday, even after the data from the Eurozone and Germany highlighted improving economic sentiment in August. The US Dollar (USD) benefits from the risk-averse market atmosphere as tensions in Middle East remain high, making it difficult for the pair to turn north.

Gold sticks to losses below $4,400 as USD recovers further from two-month low

Gold remains depressed below the $4,400 mark through the first half of the European session, snapping a two-day winning streak amid a broadly firmer US Dollar. Inflation risks stemming from higher oil prices back the case for at least one interest rate hike by the US Federal Reserve in 2026.

Crypto Today: Bitcoin, Ethereum, XRP falter amid escalating US-Iran tensions

Cryptocurrency prices are broadly correcting on Tuesday, with Bitcoin edging lower toward $64,000. Ethereum shows weakness amid ongoing narrow-range consolidation, while Ripple trades below $1.00, weighed down by falling technical indicators.

Fiscal concerns and doubts on Fed independence send US yields to long-term highs

US Treasury yields keep rising across the curve this week, with the yield for the 30-year Treasury bond reaching its highest level since 2007, during the global financial crisis, at 5.33% so far on Monday. A mix of concerns about the ballooning US fiscal deficit and growing doubts about the Federal Reserve’s Independence are increasing pressure on US Government Bonds.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.