Germany's Merkel: We are in the third covid wave, a new pandemic dominated by the new variants

Germany's Angela Merkel says ''we are in the third covid wave, but also in a new pandemic that is dominated by the new variants.''

EU commission president Von der Leyen echoed that sentiment and said, ''we are at the start of a third wave of covid.''

Key notes

• Merkel says we don't want any disturbance of international supply chains, but companies must fulfill their vaccine contracts.
• Says we need to supply our own population with vaccines because we know this is the way out of the crisis.
• Says we know that we will have beaten the virus only when everybody has had the chance to be vaccinated.

Earlier in the week, German Chancellor Angela Merkel had cancelled plans for a strict lockdown over Easter, just a day after the measures were announced.

The proposed lockdown was agreed with regional leaders in talks overnight on Monday, with restrictions set to be tightened between 1-5 April.

But the plan was reversed following a crisis meeting on Wednesday.

Market implications

Meanwhile, the euro is under pressure due to rising coronavirus cases in Europe with improved unemployment numbers in the United States. 

We saw the biggest rise in new coronavirus cases in Germany since Jan. 9 and the largest number of patients with COVID-19 requiring intensive care in France so far this year.

EUR/USD fell to below the 1.18 handle and the dollar index hit its highest since November overnight, at 92.697, breaking its 200-day moving average.