Dollar Steadies and Traders Look for Safety

The almighty U.S. dollar is showing signs of steadying during the Asian trade session on Monday. After weeks of volatility, the dollar showed some signs of steadying down. The safe haven Japanese yen also found a bid on Monday.

Forex traders are bracing themselves for an extended time of uncertainty as the economic impact from the Covid-19 pandemic starts to reveal itself in economic data,

The greenback was volatile this morning making gains against the euro, the New Zealand currency and Australian dollar. The GBP/USD currency exchange rate was down 0.1 percent to trade at 1.2449 and the AUD/USD Forex market was flat at 0.6158.

The EUR/USD Forex market was trading steady at 1.1132. The USD/JPY currency exchange rate was down 0.4 percent to fetch 107.47 yen.

Over the last two weeks, the greenback has seen its largest gain, weekly, since the 2008 financial crisis. It has also seen its largest weekly selloff since 2009 as Forex traders continue to act with kneejerk reactions. However, the U.S. currency continues to trade firm as it is the world’s most liquid currency.

Forex Traders monitor the Covid-19 Pandemic and boost the U.S. Dollar

There are now nearly 720,000 cases of the coronavirus (Covid-19) worldwide and the number of those infected in the United States is rising exponentially.

The United States is now the world’s epicenter of the Covid-19 outbreak. There are over 137,000 cases and 2,400 reported deaths.

As of the latest reports, Italy has over 10,000 dead. Other countries, including South Africa are reporting new cases.

So far the Covid-19 virus has claimed at least 33,925 lives at the time of this report. This is according to data released by John Hopkins University.

Global Financial Markets Remain Volatile and on Edge

The global financial markets continue with the volatility as a number of central banks are enacting large monetary stimulus programs to support and insulate their economies as activity grinds to a halt.

The Federal Reserve Board is buying an unlimited amount of Treasuries and mortgage backed securities, quantitative easing. The Fed is also buying corporate debt as well as ETFs back by corporate bonds.

A number of countries, including the United States, have introduced massive economic stimulus programs to help businesses and households.