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Fears of Coronavirus ‘Second Wave’ Leaves Markets Jittery

Pound News: Coronavirus and Brexit Uncertainty Keeping Sterling Pressured

The Pound is seeing mixed movement today overall. It has been kept under pressure by concerns over Britain’s handling of the coronavirus, but for now Sterling is avoiding fresh major losses.

Investors may be hesitant to move too much on the British currency ahead of the next upcoming round of Brexit negotiations. Any surprising Brexit news in the coming round of talks would be highly influential for Sterling.

 

Euro News: Euro Benefits from Safe Haven Demand

The Euro remained one of the market’s more appealing major currencies today. As investors are optimistic about the EU’s handling of the coronavirus, it is holding its ground. Still, as safe haven demand rose, its movement against the safe haven US Dollar was mixed.

Tomorrow will see the publication of German inflation and wholesale prices, as well as ZEW’s latest economic sentiment data. Strong data could help the Euro to maintain its appeal.

 

US Dollar News: Safe Haven Demand Helps US Dollar Recovery

Following weeks of poor performance for the US Dollar, it has been recovering slightly since last week. The US Dollar is a safe haven currency, so despite US economic jitters it is benefitting slightly from rising fears of a ‘second wave’ of coronavirus infections.

If coronavirus fears rise further, safe haven demand will likely rise too. This will help the US Dollar, even if its appeal is limited by US economic fears.

 

Canadian Dollar News: ‘Second Wave’ Fears Lead to CAD Plummet

News that Beijing was reporting a sudden jump in coronavirus cases have worsened fears that a ‘second wave’ of the virus is on the way. This has led to investors selling assets correlated to risk and trade. As oil prices plunged in response, so did the oil-correlated Canadian Dollar.

If oil prices can rebound from their recent plunge, the Canadian Dollar may see more resilient movement. For now though, coronavirus fears are keeping oil and the Canadian Dollar weak.

 

Australian Dollar News: Lingering Signs of Risk-Sentiment Keep AUD from Further Losses

The Canadian Dollar fell considerably today, but the Australian Dollar was able to avoid its worst levels. GBP/AUD advanced, but lingering hopes for risk-sentiment to be resilient kept the Australian Dollar from falling too far.

Australian Dollar investors are also hesitant to move on the currency ahead of tomorrow’s Reserve Bank of Australia (RBA) meeting minutes. If the bank remains fairly optimistic on Australia’s economy it could give the ‘Aussie’ a fresh boost.

Upcoming Data

Tuesday, 15th June

02:30    RBA Meeting Minutes

07:00    German Inflation Rate

07:00    German Wholesale Prices

07:00    UK Job Market Report

10:00    ZEW German and Eurozone Economic Sentiment

10:00    Eurozone Wage Growth

 

James Spurway
Director of Sales and Dealing

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