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America’s Roundup: Dollar dips after another surprise Fed rate cut, Wall Street sinks, Gold dives, Oil slumps-March 17th,2020

Market Roundup

• US March NY Empire State Manufacturing Index -21.50, 4.00 forecast, 12.90 previous

• French 12-Month BTF Auction -0.625%,-0.716% previous

• French 3-Month BTF Auction-0.608%,-0.668% previous

• US 3-Month Bill Auction 0 .290%,0.390% previous

• US 6-Month Bill Auction 0.300%,0.400% previous

Looking Ahead - Economic Data (GMT)

• 20:00 New Zealand Westpac Consumer Sentiment (Q1) 109.9 previous

• 21:00 Japan March Reuters Tankan Index -5 previous

• 00:30 Australia House Price Index (QoQ) (Q4) 3.9%,2.4% previous

• 21:00 Japan Jan Capacity Utilization (MoM) -0.5%,-0.4% previous

• 04:30 Japan Jan Industrial Production (MoM) 0.8%,1.2% previous

Looking Ahead - Events, Other Releases (GMT)

• 00:00 Australia RBA Meeting Minutes

Currency Summaries

EUR/USD: The euro strengthened on Monday, as dollar stumbled after the Federal Reserve slashed interest rates in an emergency move and its major peers offered cheap U.S. dollars to ease a ruinous logjam in global lending markets. The Fed’s emergency 100 basis point cut on Sunday was followed on Monday by the Bank of Japan easing policy further with a pledge to ramp up purchases of exchange-traded funds and other risky assets The drastic manoeuvres were aimed at cushioning the economic impact as the breakneck spread of the coronavirus all but shut down more countries, though they had only limited success in calming panicky investors . Immediate resistance can be seen at 1.1241 (Daily high), an upside break can trigger rise towards 1.1286 (50% Fib).On the downside, immediate support is seen at 1.1055 (5 DMA), a break below could take the pair towards 1.1000 (Psychological level).

GBP/USD: Sterling gained against the U.S. dollar on Monday, as money markets digested a further surprise cut to U.S. rates to rock-bottom levels by the Federal Reserve in the face of the coronavirus pandemic. The Fed cut rates to a target rate of 0% to 0.25% on Sunday, while five other central banks including the Bank of England took steps to relieve a shortage of dollars and provide extra liquidity as part of a global coordinated action. The pound was last up 0.23% against the U.S. dollar at $1.2309. Immediate resistance can be seen at 1.2425 (Daily high), an upside break can trigger rise towards 1.2563 (5 DMA).On the downside, immediate support is seen at 1.2201 (Daily low), a break below could take the pair towards 1.2179 (23.6% fib).

USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday as measures taken by global central banks to cushion the economic impact of the coronavirus outbreak failed to calm financial markets, with stocks and the price of oil tumbling. The Fed’s move to slash interest rates could raise speculation that the Bank of Canada will ease further. Canada’s central bank cut its key policy rate on Friday by 50 basis points in an emergency move to leave it at 0.75%.At (1306 GMT), the Canadian dollar was trading 0.9% lower at 1.3932 to the greenback. The currency, which hit on Friday hit a four-year low at 1.3996, traded in a range of 1.3730 to 1.3940.. Immediate resistance can be seen at 1.3277 (50% retracement level), an upside break can trigger rise towards 1.3355 (38.2% retracement level).On the downside, immediate support is seen at 1.3970 (23.6 %fib ), a break below could take the pair towards 1.3920 (38.2% fib)

USD/JPY: The dollar declined against the Japanese yen on Monday as concerns about the spreading coronavirus sent investors running from higher risk assets, even after the U.S. Federal Reserve slashed rates to zero and launched new quantitative easing. The Fed cut U.S. interest rates on Sunday and said it would expand its balance sheet by at least $700 billion in the coming weeks. The move is expected to help resolve some market dislocations including illiquidity in the U.S. Treasury market, but it may not benefit companies that are struggling as people avoid going out because of the virus, and as businesses face mandatory shutdowns. Strong resistance can be seen at 107.64 (Daily high), an upside break can trigger rise towards 108.98(50 DMA).On the downside, immediate support is seen at 105.80 (5 DMA), a break below could take the pair towards 105.00 (Psychological level).

Equities Recap

European shares plummeted to 2012 lows on Monday as the coronavirus pandemic raged through Europe, with dramatic monetary easing by global central banks failing to reassure investors about its growing economic damage.

The UK's benchmark FTSE 100 closed up by 4.01 percent, Germany's Dax ended down by 5.26 percent, and France’s CAC finished the down by 5.75 percent.

U.S. stocks fell sharply on Monday as the Federal Reserve’s drastic move to cut interest rates to near zero fueled anxiety over the extent of economic damage from the coronavirus pandemic.

Dow Jones closed down by 12.93 percent, S&P 500 ended down by 11.98 percent, Nasdaq finished the day down by 12.32 percent.

Treasuries Recap

U.S. government bonds yields fell on Monday morning but remained off the session lows plumbed in overnight trade after the Federal Reserve announced that it would slash interest rates near zero and pledged billions of dollars in asset purchases to bolster the global economy as the coronavirus hits economic activity.

The benchmark 10-year Treasury yield, which is reflective of investors’ long-term views of the health of the economy, was last down 15.4 basis points to 0.800% in mid-morning trade.

Commodities Recap

Gold fell on Monday as investors unloaded precious metals in exchange for cash after a second emergency U.S. rate cut failed to quell coronavirus fears across markets.

Gold slipped 1.4% to $1,508.44 per ounce. U.S. gold futures were 0.3% lower at $1,512.50 per ounce.

Oil prices fell below $30 a barrel on Monday as the worldwide coronavirus outbreak worsened over the weekend, exacerbating fears that government lockdowns to contain the spread of the disease would spark a global recession.

Oil futures for West Texas Intermediate, the U.S. benchmark, fell $3.03 to settle at $28.70 a barrel, while Brent crude futures fell $3.80 to settle at $30.05 a barrel.

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