Second wave of virus concerns boost haven currencies
There is a jump in new virus cases in Beijing and more than 20 states in the US. After dozens of people tested positive at a wholesale market in Beijing, the city closed its largest fruit and vegetable supply center and locked down nearby housing districts. The market reacted by shifting towards risk-off trading supporting haven currencies and causing downward pressure on commodity linked currencies with Norwegian krone and Australian dollar leading losses against USD.
6/17 Wednesday UK CPI, Canada CPI, US Housing Starts
6/18 Thursday Bank of England Bank Rate; US Initial Jobless Claims
June 15, 2020
EUR/USD 1.1252 GBP/USD 1.2539 USD/CAD 1.3654 AUD/USD 0.6828 USD/JPY 107.4400 USD/CNH 7.0901 USD/ILS 3.4969 USD/MXN 22.6392 USD/CHF 0.9499 USD/INR 76.0300
USDThe greenback rose for a third day earlier in the session strengthening as much as 0.5%. US Treasuries also rallied as investors shifted towards haven assets. The latest virus concerns signal that there may be a long road to economic recovery.GBPSterling hit a two-week low of 1.2455 before rebounding back above 1.2500. British Prime Minister Boris Johnson will hold talks with European Union top officials in an attempt to reset negotiations that have drifted into a stalemate.EUREUR/USD is trading around 1.1250, slightly lower than session highs of 1.1268. The next level of support is at 1.1222.CADUSD/CAD reversed a three-week losing streak after crude oil prices slumped and US dollar strengthened across the board as traders moved towards risk-off sentiment. WTI fell towards $35/bbl after sliding 8.3% last week.ASIA/PACIFICThe Japanese yen fell slightly after sliding 2% last week. Risk aversion due to concern of a second wave for the coronavirus caused NZD and AUD to weaken. The New Zealand dollar was traded at four-month highs last week on optimism that the economy is reopening. The kiwi traded to a low of 0.6381 and has since rebounded back above 0.64.
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