The almighty U.S. dollar continues to hold onto gains against the safe haven Japanese yen during the Asian trade session on Thursday.
Forex traders are closely monitoring the spread of the coronavirus that is now reported in over 30 countries. This has caused a flight to safety which includes the world’s most liquid currency, the dollar and U.S. Treasuries.
Against the British pound, the U.S. dollar was trading near a three month high as Forex traders worry about the current free trade agreement talks between the European Union and the United Kingdom. Talks appear to be stalling and this could cause the UK to delta fiscal spending plans.
The EUR/USD currency exchange rate was trading steady. Traders are digesting headlines that the German finance ministry might consider easing fiscal spending restrictions to boost a rapidly slowing economy.
The USD/JPY Forex market was trading at 110.35 yen after gaining 0.2 percent yesterday. Overnight, the greenback hit a ten month high against the yen at 112.23 yen.
Dollar Markets remain Steady on Thursday
Many Forex pairs, connected to the greenback, are locked in narrow trade ranges as traders are monitoring the global spread of the coronavirus which has reached six continents.
The contagion is now spreading much faster outside of China. This is stoking worries that the global economy will slow down as supply chains are disrupted. This damage could be worse than expected but it is still too early to assess the fallout.
The WHO rattles the Nerves of Financial Traders
The head of the World Health Organization (WHO) said that the sudden increase in new coronavirus cases is “deeply concerning.” He said that the virus could still be contained and is not yet a global pandemic.
Health officials around the world are fighting to contain the spread of the coronavirus. This contagion is now in 30 countries and six continents. However, Wall Street traded higher after selling off for two straight days but trader sentiment remains overall risk-off.