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Forex Today: King dollar rules amid coronavirus gloom, all eyes on US Jobless Claims

The risk-off sentiment extended into Thursday amid increasing concerns over the coronavirus induced global economic gloom and doom. Broad-based US dollar strength dominated once again, as investors ran for cover and sold-off global stocks alongside equity futures.

The slump in the US Retail Sales and Industrial Production reinforced the virus-led global recession fears while the bleak economic growth outlook for Asia by the International Monetary Fund (IMF) further roiled the market mood. Additionally, investors remained wary following the latest US report that China conducted low-level nuclear tests.

Despite risk-aversion, gold prices failed to benefit and held the lower ground around 1715 levels while oil prices rebounded on hopes that the rising US crude stocks would push the producers to deepen the output cuts.

Within the G10 currency markets, the Antipodeans were the biggest causalities of the broad dollar strength, with AUD/USD downed to five-day lows below 0.6300 while the Kiwi breached the 0.5950 support. Australian dollar ignored the upbeat employment data, as it was for the pre-lockdown period. Meanwhile, the Canadian dollar reported small losses despite the bounce in oil prices, with USD/CAD bid well above 1.4100.

USD/JPY rallied 0.50% and briefly regained the 108 level, as Treasury yields also traded in the green. EUR/USD slipped further below 1.0900 while the cable extended the downside towards 1.2450.  

Main topics in Asia

USD/MXN Price Analysis: Mexican peso drops as Fitch downgrades Mexico to BBB-

US Pres. Trump: Data suggests that the nation has passed the peak on new coronavirus cases

IMF's Georgieva: Executive board approves creation of short-term liquidity line…

G-20 okays debt standstill for the world’s poorest nations

Reuters Tankan survey: Japanese business confidence drops to fresh decade lows

RBNZ Orr: We entered the crisis with banks in a strong position

IMF: Asia's economic growth this year will grind to a halt for the first time in 60 years           

NZ PM Ardern: Will make the lockdown decision on Monday, April 20

Aussie jobs data better than expected, but the caveat is ...

Japanese firms say govt’s $1 trln coronavirus stimulus insufficient, too late – Reuters poll

Coronavirus update: China’s local infections rise while imported cases drop

US State Department: China may have conducted low-level nuclear test blasts

South Korea proposes $6.2 bln extra budget to fight coronavirus, KRW keeps lows

Japan PM Abe reportedly secured funds for JPY100,000 cash payouts to all citizens - Kyodo

Key focus ahead        

Thursday’s EUR macro calendar lacks first-tier economic releases, therefore, traders will take some incentives from the German Final Consumer Price Index (CPI) and Wholesale Price Index (WPI) data due on the cards at 0600 GMT. Later in the European hours, the Bank of England (BOE) Credit Conditions Survey for the first quarter will be released, followed by the Eurozone February Industrial Production at 0900 GMT.

In contrast, a flurry of relevant US macro data will be released at 1230 GMT, including the Initial Jobless Claims, Housing Starts, Building Permits and Philly Fed Manufacturing Survey for April. Parallelly, the Canadian Manufacturing Sales data will also drop in.

Apart from the data, the speeches by the Bank of England (BOE) policymakers Tenreyro and US Federal Reserve (Fed) official Williams will remain in focus amid incoming coronavirus-related updates and earnings reports.

Meanwhile, US President Donald Trump is likely to announce new guidelines for reopening the economy on Thursday. The UK government will review social distancing measures.

 EUR/USD back below 200-hour MA ahead of Eurozone's Industrial Production

EUR/USD faded an overnight spike above the 200-hour MA in Asia. Risk-off continues to bode well for the US dollar, a global reserve currency. Eurozone's Industrial Production is forecasted to have contracted by 0.2% in February. 

GBP/USD extends losses below 1.2500 as risk-off favors US dollar

GBP/USD registers two-day declines amid broad US dollar strength. Coronavirus crisis keeps risk-aversion in play, Brexit talks to resume from next week. US data, UK’s review of social distancing measures in focus.

US Jobless Claims Preview: Facts that retain the ability to move markets

Initial unemployment claims expected to be 5.1 million. Four week total would be over 21 million, 13% of the workforce. Continuing claims projected to almost double to 14 million.
 

GMT
Event
Vol.
Actual
Consensus
Previous
Thursday, Apr 09
24h
 
 
24h
 
 
24h
 
 
24h
 
 
24h
 
 
24h
 
 
24h
 
 
Friday, Apr 10
24h
 
 
24h
 
 
Sunday, Apr 12
24h
 
 
24h
 
 
24h
 
 
24h
 
 
24h
 
 
24h
 
 
Monday, Apr 13
24h
 
 
Thursday, Apr 16
06:00
 
-0.4%
-0.9%
06:00
 
-0.3%
-0.9%
06:00
 
0.1%
0.1%
06:00
 
0.1%
0.1%
06:00
 
1.3%
1.3%
06:00
 
1.4%
1.4%
06:30
 
-0.5%
-0.9%
06:30
 
-2.5%
-2.1%
n/a
 
 
09:00
 
-0.2%
2.3%
09:00
 
-2.0%
-1.9%
12:30
 
1.300M
1.599M
12:30
 
1.300M
1.452M Revised from 1.464M
12:30
 
 
-6.3% Revised from -5.5%
12:30
 
 
-1.5%
12:30
 
 
4,265.5K
12:30
 
5,100K
6,606K
12:30
 
14.000M
7.455M
12:30
 
-30.0
-12.7
12:30
 
-0.1%
-0.2%
13:30
 
 
14:30
 
24B
38B
15:30
 
 
0.19%
19:00
 
 
22:30
 
50.6
53.2

Author

Dhwani Mehta

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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