Here is what you need to know on Thursday, February 20:
Coronavirus: Fears are dominating markets once again after the number of cases in South Korea doubled and two people on the Diamond Princess cruise ship died. China has changed its counting methodology once again, causing confusion. On the economic front, Beijing has provided more liquidity and cut requirements for the household loans but some see it as insufficient.
USD/JPY has been consolidating its gains well above 111 after soaring on Wednesday. A combination of data-related dollar strength, receding coronavirus fears, the triggering of stops, and a late reaction to dismal Japanese growth figures are behind the meteoric rise. The downbeat market mood is helping the yen stabilize.
Gold prices have topped $1,612 amid coronavirus fears and other reasons. It is the highest since 2013. The precious metal has been extending its gains that began in 2019 and topped the peak seen around the Iran crisis early in 2020.
See Gold Price Analysis: Pulls back amid overbought RSI, multiple upside barriers ahead
AUD/USD has hit new 11-year lows at 0.6630 after Australia reported a disappointing increase in the unemployment rate to 5.3% in January. It is hovering around the lows last seen in 2009.
EUR/USD is also near the 34-month lows of 1.0782 after having almost fully closed the "Macron Gap" from 2017. The European Central Bank's minutes from the January decision may shed more light on the bank's next moves. Germany's weakness may prompt more stimulus. Details of the ECB's strategic review are also eyed.
See ECB Minutes Preview: Coronavirus, inflation, and strategic review comments set to move EUR/USD.
GBP/USD also dropped sharply to around 1.29 despite higher than expected inflation figures. The pound has come under pressure after EU ambassadors failed to agree on a position toward the UK in post-Brexit talks. UK retail sales are forecast to show an increase in January after two months of substantial falls.
The Federal Reserve's meeting minutes have confirmed the bank's stance that it intends to leave rates unchanged. The minutes also provided several technical details about the Fed's plan to taper down the buying of short-term bonds.
See FOMC minutes mix economic optimism and caution
The Philly Fed Manufacturing Index is of interest on Thursday. On Wednesday, Housing Starts, Building Permits, and the Producer Price Index are all beat expectations.
Cryptocurrencies suffered a sell-off late on Wednesday. Bitcoin is trading around $9,500, Ethereum at around $260, and XRP below $0.30.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD trades modestly flat above 0.6400 after Aussie trade data
AUD/USD reacts little to better-than-expected Australian Goods Trade Balance data and remains in a range above 0.6400 early Thursday. Rising bets for an early RBA rate cut cap the Aussie's upside amid China's economic woes and US-Sino trade war fears. Eyes turn to US data, Fedspeak.
Bitcoin price breaks above the $100K milestone
Bitcoin's price surpassed the $100K mark on Thursday after its recent pullback last week.The momentum indicator, the Relative Strength Index, indicates a continuation of the uptrend, while the technical outlook suggests a rally toward $125K.
USD/JPY fades the dovish BoJ commentary-led uptick above 150.50
USD/JPY is reversing the bounce to near 150.70 in the Asian session on Thursday. The pair remains weighed down by rising bets for another BoJ rate hike this month, shrugging off the dovish comments from BoJ policymaker Nakamura and a modest recovery in the US Treasury bond yields.
Gold extends range play as focus shifts to US Nonfarm Payrolls
Gold's price continues with its narrow range struggle at around $2,650 early Thursday, stalling Federal Reserve Chairman Jerome Powell’s speech-led uptick. The focus now remains on the US Jobless Claims data due later in the day in the lead-up to the all-important Nonfarm Payrolls data.
Four out of G10
In most cases, the G10 central bank stories for December are starting to converge on a single outcome. Here is the state of play: Fed: My interpretation of Waller’s speech this week is that his prior probability for a December cut was around 75% before the data.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.