- The rate of increase globally in fatalities and new confirmed infections from the coronavirus pandemic continues to increase exponentially, with its epicenter now in New York. A world recession or possibly even depression appears to be inevitable, with Goldman Sachs forecasting a 34% drop in U.S. Q2 annualized GDP and other analysts seeing a 30% unemployment rate in the near future. If correct, these will be the worst such numbers seen since the 1930s.
- Despite the gloomy global economic outlook, stock markets (especially in the U.S.A.) rose strongly yesterday, and other risky assets were also boosted. Many analysts think the bottom of this bear market has already been reached, but other analysts see further strong falls likely in stocks over the coming weeks and months.
- The Prime Minister of the United Kingdom, Boris Johnson, was moved to an intensive care unit after being hospitalized the previous day due to persistent coronavirus symptoms. He tested positive for the virus 11 days ago.
- The rate of increase in new confirmed cases and deaths seems to have peaked in the hard-hit European nations of Italy and Spain, but both still seem to be increasing in the U.S.A. and in the U.K. The strongest growth of the virus in the world now is happening in New York City and New York State, with the U.S.A. now leading the world in number of confirmed cases (about 25% of the global total), having had more than 10,000 deaths so far. Even in Germany, the death rate to confirmed infections has risen to about 1.5%.
- The price of Gold rose strongly yesterday, with the price now not far off its recent multi-year high made above $1700.
- WTI Crude Oil consolidated after having bounced back strongly from its 18-year low below $20 reached last week.
- Currency markets are currently dominated by weakness in the U.S. Dollar, while the Australian Dollar is rising strongly as the RBA left rates unchanged.
- Markets have been affected by high relative volatility, but this is generally decreasing, although stocks are still showing high volatility.
- There are no high-impact economic data releases scheduled for today.
Forex Today: Has the Bear Market Been Reached?
Adam Lemon