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CORONAVIRUS CRISIS:

Ø  Total confirmed cases: More than 3,222,315

Ø  Total deaths: At least 228,269

Ø  The coronavirus COVID-19 is affecting 210 countries and territories around the world and 2international conveyances: the Diamond Princess cruise ship harbored inYokohama, Japan, and the Holland America's MS Zaandam cruise ship.

Ø  US cases: At least 1,064,572 (+378) and deaths: 61,669 (+13)
Ø  Thailand cases: At least 2,954 (+7) and deaths: 54

  

·       The dollar fell on Thursday after the U.S. Federal Reserve left the door open to more monetary easing and dampened expectations for a quick economic recovery from the coronavirus crisis.

The greenback also pulled back on signs the pandemic is receding in other countries and on reduced safe-haven demand for holding funds in dollars. Positive trial results for a drug to treat COVID-19 also boosted the appetite for riskier assets.

The euro edged lower before a European Central Bank meeting later on Thursday where policymakers are likely to expand debt purchases to include junk bonds and take other steps to ease conditions in credit markets.

China’s currency hit a two-week high on hopes over the potential virus treatment. Data also suggests the world’s second-largest economy is starting to slowly recover from the coronavirus-driven dive in activity even though the path ahead appeared bumpy.

The dollar fell slightly to 106.50 yen JPY=EBS on Thursday, close to a six-week low.

Against the pound GBP=D3, the dollar stood at $1.2480, following a 0.3% decline on Wednesday.

In the onshore market, the yuan CNY=CFXS rose to a two-week high of 7.0534 per dollar partly supported by data showing factory activity in China expanded, albeit at a slower pace, for a second straight month in April.

 

·       EUR/USD Price Analysis: Defies short-term rising wedge confirmation, but still below 1.0900

EUR/USD trims early-Asia losses with the latest bounces propelling the quote to 1.0870 during the initial trading on Thursday. In doing so, the pair defies the confirmation of the short-term rising wedge bearish chart pattern.

However, a downward sloping trend line since April 16, 2020, as well as 61.8% Fibonacci retracement of April 14-24 declines, around 1.0885/90, restricts the pair’s upside momentum.

Other than that, the bearish formation’s resistance line, near 1.0915, also add upside barriers to the quote’s recovery moves.

Meanwhile, the pair’s sustained break below 1.0860 support may avail 1.0800 and 1.0760 as buffers during the south-run targeting the latest low close to 1.0725.

·       The European Central Bank’s (ECB) Governing Council will convene in a virtual meeting Thursday to discuss whether the measures taken, for now, are enough to weather what could be the worst economic crisis since World War II.

The odds are high that ECB President Christine Lagarde will stress the central bank’s ability to do more if needed in order to avoid fragmentation in the euro area and a tightening of financial conditions.

“There are two objectives the ECB will focus on at that stage. First, to ensure accommodative financial conditions and preventing tensions in the financial system,” said Dirk Schumacher, an ECB watcher with Natixis, in a research note.

“Second to create fiscal space for governments to fight the cyclical consequences of the pandemic.”

To manage the second objective, the ECB is trying to rein in spread expansions between the core and so-called peripheral countries such as Italy, Spain, Portugal and Greece. A spread refers to the difference in the yields between countries, which can highlight how fearful investors have become on owning European debt. 

 

·       Millions more Americans likely filed claims for unemployment benefits last week, but the tide appears to be slowing, offering cautious hope of a peak in job losses from business closures and disruptions because of the novel coronavirus.

Jobless benefit applications, since hitting a record 6.867 million in the week ended March 28, have been trending lower as overwhelmed state employment offices cleared backlogs.

But the numbers are still at high levels unimaginable just months ago. Initial claims for state unemployment benefits likely totaled a seasonally adjusted 3.50 million for the week ended April 25, according to a Reuters survey of economists. That would be down from 4.427 million in the prior week and mark the fourth straight weekly decrease in applications.

“As these claims are processed, there could even be a sharp drop in initial filings,” said Andrew Hollenhorst, an economist at Citigroup in New York. “Still, job separations will likely remain high for a while, as softer demand spills over into industries not initially directly affected by shutdowns.”

 

·       All around the world, people are waiting for the announcement that the coronavirus pandemic is contained and they can return to normal life.

But the Chinese city at the center of the pandemic has shown that normal might still be a long way off.

When Wuhan officials eased outgoing travel restrictions on April 8, effectively ending the city's 76-day lockdown, residents and local businesses soon learned that city's actual reopening would be painfully slow.

During a recent trip to the city, business owners told CNN that they were struggling with zero profits and huge rents and experts said that it might take the city's economy months to recover, if not longer.

"In the short term, of course, there's going to be a recovery," said Larry Hu, economist at Macquarie Capital Limited. "Production will recover first and then consumption, because a lot of people are still reluctant to come out ... but from a long term perspective, from a three-year perspective the virus is still going to hurt the long term growth of Wuhan."

Some small business owners relayed to CNN their concern that any government assistance will likely arrive too late to save their small shops and restaurants, leading them to shut down for good.

Worst of all, some local citizens and business owners told CNN that they believed it was only a matter of time until a second wave of infections swept through the city, prompting a second lockdown and dealing another blow to the economy.

 

·       China will increase subsidies for small and medium-sized airports, the finance ministry said on Thursday.

The government will raise subsidies by 50% for airports that cross the 2 million passenger throughput mark for the first time, the ministry said in a statement.

 

·       Oil prices jumped on Thursday, buoyed by signs that the U.S. crude glut is not growing as quickly as expected and that fuel demand battered by COVID-19 restrictions is starting to pick up.

West Texas Intermediate (WTI) crude futures CLc1 climbed to a high of $17.75 a barrel and were up 9.2%, or $1.39, at $16.45 at 0640 GMT. The U.S. benchmark surged 22% on Wednesday.

Brent LCOc1 was up 5.6%, or $1.27 at $23.81 a barrel in light trading, with the June contract expiring on Thursday. The contract hit a high of $25 earlier in the session, having posted a 10% gain on Wednesday.

The most active Brent crude contract for July LCOc2 was up $1.15 or about 5%, at $25.38 a barrel.

U.S. crude inventories grew by 9 million barrels last week to 527.6 million barrels, U.S. Energy Information Administration data showed, well below the 10.6 million-barrel rise analysts polled by Reuters had expected.

 

·       Energy demand set to fall the most on record this year amid coronavirus pandemic, IEA says

The International Energy Agency (IEA) said Thursday that it expects global energy demand to plunge this year amid the COVID-19 pandemic, in what the Paris-based agency called the biggest shock since World War II.

With roughly 4.2 billion people around the world subject to some form of lockdown in an effort to slow the spread of the coronavirus, the IEA is forecasting a 6% drop in energy demand for the year. In absolute terms this is the largest on record. Percentage wise, it’s the steepest decline in 70 years.

The demand hit from the pandemic is expected to be seven times greater than the decline in the aftermath of the financial crisis in 2008.

“In absolute terms, the decline is unprecedented – the equivalent of losing the entire energy demand of India, the world’s third largest energy consumer,” the agency’s Global Energy Report said.

Under a faster return-to-business scenario, the IEA said demand loss could be limited to 3.8%, while a possible second wave of the outbreak could cause a greater than 6% decline.

 

·       Oil Price Forecast: WTI extends Wednesday's double digit rally, trades above $16

West Texas Intermediate (WTI) crude, North America's oil benchmark, is trading near $16.30 at press time, representing an 8% gain on the day.

Oil's ascent may continue, as the OPEC+, a group of major producers led by Russia and Saudi Arabia will reduce their daily output by nearly 10 million barrels from May 1. Additionally, reports are doing the rounds that regulators in Texas, the biggest U.S. oil-producing state, are scheduled to vote on May 5 whether to enact output cuts. Officials in North Dakota and Oklahoma are also considering reducing output.