Investors were more positive about riskier currencies as China’s work force resumed operations in China after the Lunar New Year break.
Market participants monitor the economic impact of the coronavirus outbreak and company updates as China’s work force returned to work in China. Chinese authorities lifted some work and travel curbs, helping businesses to resume operations.
As the rate of increase of reported cases appears to slow, markets have recovered some ground. But analysts expect the world economy to take a hit from an expected slowdown in China
The death toll from the epidemic has now surpassed that of Severe Acute Respiratory Syndrome (SARS) two decades ago. The World Health Organization said the number of cases outside China could be just “the tip of the iceberg”. Rising concerns over the severity of the coronavirus outbreak weighed on market worries.
Markets will also watch out for Fed Powell’s two-day address to the U.S. Congress, especially for commentary related to the China-linked virus.
START TRADINGForex – China’s work force back to business
This week, a slew of earnings reports and U.S. retail sales data could help markets determine to what extent the coronavirus is hitting consumer demand.
A stronger U.S. dollar dragged the euro down to its lowest level in months. The greenback, however, was stronger against other major currencies.
The safe-haven yen was trading neutral at 109.75 yen per dollar.
The US currency pushed the euro to match a four-month low of $1.0942 and dragged the pound down to a 2-1/2-month low of $1.2873.
The euro fell to its lowest since October after German industrial output for December recorded its biggest decline in a decade.
The Australian dollar rose 0.3% to 0.6694 per U.S. dollar, pulling away from a decade-low touched earlier in the session.
Sterling briefly slipped to its lowest level in 2-1/2 months against a broadly firm U.S. dollar on Monday. Britain’s pound recovered and traded last at $1.2911, up 0.2% on the day. Versus the euro, the pound was 0.2% higher at 84.84 pence. With no news or data to drive the pound, the currency was taking its cue from broader trends in currency markets.
In commodities, Brent crude futures eased 0.42% to $54.24 a barrel while U.S. crude futures fell 0.38% to $50.13 a barrel. Since Jan. 17, oil prices have fallen by 14% while copper is down around 10%.
Spot gold gained 0.12% to trade at $1,572 an ounce.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money