Optimism that the coronavirus crisis was slowing faded, increasing investor concerns over the economic impact of the pandemic, while dollar prevails.
European Union finance ministers failed to agree in all-night talks on more support for their coronavirus-hit economies. Eurogroup chairman Mario Centeno said on Wednesday morning he was suspending the discussions until Thursday. If they do eventually agree, the combined pan-EU and national government responses could add up to the biggest fiscal support programme in the world.
European stock markets headed lower on Wednesday following a two-day rally. The coronavirus death toll rose in some of the worst-hit parts of the continent.
There are signs of a plateau in hospitalisations in New York. Some European countries plan to start easing their lockdowns with fatalities declining. Meanwhile, France has officially registered more than 10,000 deaths from coronavirus, the fourth country to cross that threshold.
The Chinese city where the coronavirus pandemic first emerged, Wuhan, ended a two-month lockdown on Wednesday. However, concerns over a second wave of infections remain.
START TRADINGForex – Dollar prevails as optimism fades
Investors and businesses feared the worst and have rushed to the world’s reserve currency once again.
Against a basket of currencies, the dollar edged up 0.1% to 100.050, giving up slightly some of its earlier advance.
The dollar made gains against various currencies. Dollar prevails against the pound, the yen and the Swiss franc, the New Zealand and Australian dollars, before easing slightly.
The greenback last stood flat against the pound at $1.2345 and the franc at 0.9707. The US currency turned slightly negative against the yen to 108.80.
The Australian dollar fell 0.6% in early European trading after ratings agency S&P cut the outlook for its sovereign AAA rating from stable to negative.
The euro was the main loser at the greenback’s expense. The euro fell 0.2% to $1.0875, hit by the failure of European Union finance ministers to agree on further support.
The pound edged lower against the dollar on Wednesday, as demand for the U.S. currency rose broadly. The sterling was 0.24% lower at $1.2303. But the UK currency gained against a broadly weaker euro to trade 0.1% higher at 88.20 pence.
Oil prices rose slightly ahead of a meeting between OPEC members and allied producers that traders hope could lead to output cuts. Brent crude added 0.5% to $32.00 per barrel after falling 3.6% on Tuesday. WTI crude rose 2.9% to $24.31 a barrel.
Economic data in the UK added to the gloom.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money