Forex Today: Dollar in demand as a turbulent quarter draws to an end, coronavirus, consumers eyed

Yohay Elam FXStreet

Here is what you need to know on Tuesday, March 31:

The US dollar has been extending its gradual recovery, gaining ground against majors while stock futures are leaning lower after US indexes rallied on Monday.

US coronavirus cases continue rising and have topped 160,000. Additional states have announced lockdowns while President Donald Trump extended the guidance for social distancing through April and said that seeing fewer than 100,000 fatalities would be an achievement. Figures from New York, the epicenter of the disease, remain of high interest.

More Is a US recession inevitable? What does the history of consumer sentiment tell us?

The World Health Organization has said that coronavirus may have peaked in Europe. The number of new cases in Italy and Spain has been stabilizing and provide hope. Spain is under more severe lockdown measures, and Italy is grappling with growing poverty in the south. Eurozone Consumer Price Index figures for February are projected to rise by a slower rate, yet markets are focused on Covid-19 statistics.

Deaths keep rising in the UK, which has changed its counting method. Prime Minister Boris Johnson is under pressure to increase the pace of tests. Final Gross Domestic Product figures for the fourth quarter are due out.

Chinese Purchasing Managers’ Indexes have come out above expectations, with the Manufacturing PMI at 52 in March and the Non-Manufacturing at 52.3. Both figures were projected to remain below 50 – reflecting contraction.

The US Conference Board’s Consumer Confidence gauge for March is forecast to collapse amid the health crisis, tumbling from the high level of 130.7 recorded in February.

See US Conference Board Consumer Confidence March Preview: Three years vanish in an instant

End-of-quarter flows are set to rock markets today and make cause jitters, especially around the end of the European session.

Oil prices are attempting a recovery after another sell-off on Monday. WTI is trading around $21, recovering from a dip below $20. The Canadian dollar has been pressured by falling crude prices and now faces a test via monthly GDP statistics for January, expected to rise by 0.1%.

Cryptocurrencies ave been holding onto familiar ranges, with Bitcoin trading around $6,400.

US labor market figures are of high interest in the next few days. see: How will coronavirus impact the Unemployment Rate after causing a surge in Jobless Claims?

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

GBP/USD weakens to two-week lows near 1.3520

GBP/USD trades on the back foot, returning to the low 1.3500s, or two-week troughs, on Tuesday. Cable’s bearish price action follows decent gains in the Greenback at the time when investors assess latest US data releases and the persistent uncertainty in the US-Iran crisis.

EUR/USD remains offered; breaks below 1.1600

EUR/USD now accelerates its daily correction, breaching below the key 1.1600 support level on Tuesday. The pair’s daily correction comes on the back of a decent bounce in the US Dollar despite disappointing US data releases and amid persistent geopolitical concerns.

No reaction from Gold; still targets $4,300

Gold extends Monday’s pessimism and slipped back to nearly three-week lows just above the $4,300 mark per troy ounce on Tuesday. The US Dollar’s rebound couple with rising US Treasury yields weigh on the precious metal despite tensions in the Middle East appear far from abated.

Crypto Today: Bitcoin, Ethereum, XRP struggle to extend gains despite ETF inflows

Bitcoin stalls while holding above $78,000 support as ETF inflows return. Ethereum takes a breather around $2,450 amid sustained institutional support. XRP remains pressured as the 200-day EMA provides immediate support.

Global bond market sell off haunts markets

Global sovereign bonds are selling off as we start a new month. The UK is, unsurprisingly, taking the biggest hit. Two and 10-year yields rose by 10 basis points at one point on Tuesday, and are currently higher by 7 and 8bps respectively.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.