Chinese Workers Return to Work Despite Rising Death Toll
Sunday saw a record 97 deaths due to coronavirus on mainland China, but that didn’t stop employers from opening their doors after weeks of keeping workers at home. Businesses and factories had been closed in an extension of the Chinese Lunar New Year for ten days. Public transportation remains largely unused, with workers preferring to travel independently, rather than risking infection in public spaces. The Hubei province where the virus began remains largely shuttered. Automobile producers including Ford, Tesla, and Daimler are among the factories that will be reopened starting on Monday, as did Samsung Electronics.
On Sunday, the death toll rose to 908, with 40,171 cases reported. China’s central bank has been working hard to control the economic damage, including introducing liquidity into the market and lowering interest rates. Special funds will also be made available for banks seeking to lend businesses money to deal with the downturn.
Consumer prices rose in China by 5.4 percent year over year in January, surpassing forecasts by over 4.9 percent, the National Bureau of Statistics announced on Monday. The driving force behind the increase was a jump in food prices, which increased 20.6 percent year on year in January, largely due to the Chinese New Year and the hoarding of food products due to coronavirus concerns. Pork prices soared 116 percent in January as compared to January 2020 thanks to an outbreak of African swine fever which has dramatically reduced China’s hog population. Pork has long been a staple of the Chinese diet. The chicken population in China is also facing new threats as transport restrictions in the Hubei province have prevented animal feed from getting to their final destinations. Millions of chickens in China will die if their food is not delivered soon.
Currency markets were relatively stable on Monday afternoon in Asia, and with no big news reports expected today, the lull is expected to continue. The dollar index was down a modest 0.02 percent to 98.66 .DXY as the greenback fell against the Canadian dollar, sinking 0.12 percent to $1.3295, as it faced more modest losses against most of its other primary trading partners. The U.S. dollar was up 0.07 percent against the yen, trading at 109.80, but it eased against both the pound and the euro. The pound edged up 0.02 percent against the dollar to $1.2893, while the euro was up 0.05 percent to $1.0948.
Oil prices edged higher as traders waited to hear whether OPEC and its allies would implement further production cuts and traders were met with cautious optimism as Chinese businesses reopened. U.S. WTI futures gained 0.18 percent as of 3:06 p.m. HK/SIN, to trade at $50.41 per barrel, while Brent crude futures were up 0.11 percent to $54.53 per barrel.