Daily Update - 31st March 2020
Germany released their Harmonized Index of Consumer Prices which resulted negative affecting the Boost of the Common currency indicating the current Virus Pandemic has largely impacted all sectors of Euro Zone & Globally. Followed by US Dallas Fed Manufacturing Index which far off from positive indicating and probable recession is upon us if the pandemic continues. Trump did state in his Speech that they will initiate Social Distancing process effective immediately and this has to be continued in all destinations of United States of America. For the EUR, it’s a busy day ahead on the economic calendar. Key stats March unemployment numbers out of Germany and the Eurozone’s prelim March inflation figures. French consumer spending figures for February, 4th quarter GDP numbers out of Spain and prelim March inflation figures out of Italy should have a muted impact on the day. Expect German unemployment figures to have the greatest influence on the day, with the markets prepped for softer inflationary pressures.When considering Germany’s unemployment numbers, the markets will also need to assume that worse is yet to come. Outside of the stats, the latest updates on the coronavirus numbers will also provide direction. A smaller increase in the number of new cases would provide support to the EUR. For the Pound, it’s a relatively busy day ahead on the economic calendar. Finalized 4th quarter GDP and business investment numbers will likely have a muted impact on the Pound, however. The BoE and the government have already made their moves and the markets should now be looking forward and not back to the 4th quarter. Outside of the numbers, the number of new cases in the UK would need to be on the lower side, however, for the Pound to find support. Updates from Brexit talks will also be in focus on the day. A failure to find common ground will raise the Brexit stress levels… For USD, it’s a relatively quiet day ahead on the U.S economic calendar. March consumer confidence figures will grab the limelight later today. With weak numbers expected, there should be some resilience to the figures. The markets are all too aware of the shutdown in the U.S and surge in jobless claims. This is undoubtedly going to be reflected in the confidence figures. January house price figures and Chicago PMI numbers for March will likely have a muted impact on the Dollar. While the markets will consider the numbers, we will need to digests April and May figures now to get a sense of how extended the economic meltdown will be… Trump’s decision to hold back from easing containment measures until the end of April suggests more doom and gloom ahead. Yesterday’s Market
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