US Dollar Struggles as Virus Fears Weigh
The US Dollar was lower versus the Japanese yen and Euro during London trade on Thursday as FX traders await today's release of US unemployment benefit claims. Analysts believe that the numbers to be released will have increased exponentially as US businesses lay off their workers due to the Coronavirus spread. The Pound Sterling also extended declines against the US Dollar and Euro on concerns that the British government is not well prepared for the rising numbers of Coronavirus cases. Many fear that the health system in the UK will be overwhelmed, much as has happened in Italy and Spain which have been overwhelmed.
As of 10:02 am in London, the USD/JPY was trading at 110.012 Yen, down 1.02% and off the earlier low of 109.808 Yen. The EUR/USD was trading at $1.0945, up 0.5855%; the pair has ranged from a low of $1.08697 to a peak of $1.09514. The GBP/USD was trading at $1.1892, up 0.0463%, moving off the session low of $1.17739. Meanwhile, the EUR/GBP was at 0.9206 Pence, up 0.5515% and off the earlier peak of 0.92421 Pence.
US Labor Data in Focus
Ahead in the trading day, market players are also waiting for the outcome of the Bank of England policy meeting. While the BoE has already used up most of the weapons in their monetary policy arsenal, what will be scrutinized is the minutes from the last meeting to gain some sense of the central bank's collective thinking as regards the Coronavirus. Later in the day, the US Labor Department will release new and continuing claims for unemployment benefits. Currently, economists are forecasting that new claims could exceed 1 million for the week ending March 20th, with continuing claims likely to rise to 1.708 million. Also due out is 4th quarter annualized GDP with economists predicting it to be unchanged from the previous reading, at 2.1%.