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AUD weakens on increased Coronavirus worries

Published February 14, 2020

Author : Brett Gordon

The Aussie, the Yuan as well as the Kiwi weakened during yesterday`s Asian session, as the worries about the Coronavirus intensified. China reported a substantial rise of new cases as well as deaths, practically intensifying worries about how high the death toll could be as well as for a possible adverse effect on the Chinese economy.

The US dollar has turned slightly positive this morning after inflation and job numbers met expectations on almost all fronts.  US Core CPI inflation was flat in January at 0.2%, but the annual number was slightly stronger 2.5%.  Despite the positive data, the dollar is being held back by stronger demand for yen and pounds.  More data to be released tonight with US Retail Sales for January, followed by the University of Michigan Sentiment Index later in the day.

The euro is continuing its dismal run in February and has now fallen to its lowest level since 2017.  The selloff is being driven by speculation that the economic impact of the coronavirus will keep the European Central Bank dovish.

The best performing major currency has been the British Pound after reports of UK Chancellor Javid’s resignation.   Markets are expecting his proposed replacement, Rishi Sunak, to be more aligned with Prime Minister Johnson’s economic expansion plans and see an increase in fiscal.

 

 

Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (Australia) Pty Ltd on 30 March 2020.

Rees Logan, Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (NZ) Limited on 30 March 2020.

Any queries regarding the Administrations should be directed to encorefx@au.ey.com.