· CORONAVIRUS CRISIS:
Ø Total confirmed cases: More than 3,915,625
Ø Total deaths: At least 270,683
Ø The coronavirus COVID-19 is affecting 212 countries and territories around the world and 2 international conveyances: the Diamond Princess cruise ship harbored in Yokohama, Japan, and the Holland America's MS Zaandam cruise ship.
Ø US cases: At least 1,292,623 and deaths: 76,928
Ø Spain cases: At least 256,855 and deaths: 26,070
Ø Italy cases: At least 215,858 and deaths: 29,958
Ø Thailand cases: At least 2,992 and deaths: 55
· Dollar turns negative ahead of US payrolls data
The dollar fell from two-week highs on Thursday, as investors booked profits on the currency’s gains this week before Friday’s U.S. nonfarm payrolls report for April, which could show massive job losses amid a COVID-19 pandemic that has ravaged the global economy.
The greenback gave up gains against the euro and the Swiss franc and pared its rise versus the yen.
Against commodity currencies such as the Australian and Canadian dollars, the U.S. unit extended its losses. Over the week, the dollar index was up 0.9%.
The U.S. economy is expected to have lost about 22 million jobs last month, with an unemployment rate of 16%, according to a Reuters poll.
On Thursday, data showed millions more Americans took unemployment aid from the government in the latest week.
U.S. weekly jobless claims totaled a seasonally adjusted 3.169 million for the week ended May 2, down from a revised 3.846 million in the prior week. Economists polled by Reuters had forecast 3.0 million claims in the last week.
The dollar held its gains after the data.
In afternoon trading, the dollar index fell 0.3% to 99.884, below a two-week high touched earlier in the session of 100.40.
The dollar pared gains against the yen, and was last up 0.2% at 106.315 yen. It fell 0.1% against the Swiss franc to 0.9733 franc.
After trading lower for most of the session, the euro recovered to trade 0.3% higher at $1.0825 . The euro earlier dropped to a two-week low of $1.0767.
The single European currency had weakened on nagging concern over the direction of the European Central Bank’s stimulus scheme following a German court ruling earlier this week.
Chinese exports rose 3.5% despite expectations of 15.7% drop, helping to lift the Chinese yuan in the offshore market and the Australian dollar. The yuan was last up 0.5% at 7.0927 per U.S. dollar.
· Coronavirus: US unemployment claims hit 33.3 million amid virus
A further 3.2 million Americans sought unemployment benefits last week as the economic toll from the coronavirus pandemic continued to mount.
The new applications brought the total number of jobless claims since mid-March to 33.3 million- or about 20% of the US workforce.
Since the coronavirus has taken hold in the US, the country has suffered its worst growth numbers in a decade, the worst retail sales report on record and declines in business activity not seen since the 2008 financial crisis.
· Markets start pricing in negative U.S. interest rates for first time
Financial markets began pricing in a negative U.S. interest rate environment for the first time on Thursday, a place the Federal Reserve is determined not to go, as investors grappled with the economic consequences of the new coronavirus outbreak.
U.S. central bank officials including Chair Jerome Powell have said that they do not see negative rates as appropriate in the United States.
But some investors may be seeing a much worse outcome for the coronavirus-led downturn that could force the Fed to get even more experimental with its crisis response.
Fed funds futures, which are a gauge of where markets expect the Fed’s benchmark overnight lending rate to be, have begun pricing in a slightly negative rate environment beginning in December.
- San Francisco Fed President Mary Daly said on Thursday the U.S. central bank still has tools to boost the economy, and that people she speaks with do not expect a “V”-shaped recovery.
The Fed is viewed as reluctant to cut rates into negative territory due to concerns such a move may not be effective in stimulating growth, and because it may disrupt the large U.S. money markets.
There is nothing to suggest that negative interest rates would be a suitable option for the United States, Richmond Fed President Thomas Barkin said on Thursday.
· Fed's Harker sees second U.S. recession in 2021 if too quick to reopen
The U.S. economy, already headed for a “brutally painful” second quarter but likely a return to growth in the second half of the year, could dive right back into recession next year if businesses reopen without proper measures to stop a resurgence of the coronavirus, a U.S. central banker said on Thursday.
Noting that households began paring spending amid rising infections even before authorities imposed stay-at-home orders to slow the spread, Philadelphia Federal Reserve Bank President Patrick Harker predicted that the economy will underperform until the virus is brought under control.
If the economy reopens in June with technology in place to contain the virus, activity should rebound in the second half of the year and growth should continue next year at an above-trend pace.
· Britain heading for a limited easing of lockdown next week
Prime Minister Boris Johnson will announce a very limited easing of Britain’s coronavirus lockdown next week, adopting a cautious approach to try to ensure there is no second peak of infections that could further hurt the economy.
Johnson is due to announce the next steps in Britain’s battle to tackle the novel coronavirus on Sunday following a review by ministers of the current measures that have all but shut the economy and kept millions at home for over six weeks.
· UK consumer confidence near all-time low amid COVID lockdown: GfK
British consumer confidence edged up in late April but remained close to its lowest levels on record as the country remained in coronavirus lockdown and on track for a deep recession, a survey showed on Friday.
GfK, a polling firm, said its consumer confidence index - which it is now publishing every two weeks - rose to -33 in the April 20-26 period from -34 during the first half of the month.
· Japan household spending falls in March as pandemic pain deepens
Japan’s household spending fell 6.0% in March from a year earlier, government data showed on Friday, underscoring the deepening pain the coronavirus pandemic is inflicting on the world’s third-largest economy.
The weak reading will keep policymakers under pressure to ramp up fiscal and monetary support for an economy on the cusp of deep recession, as the pandemic forces consumers to stay home and businesses remain shut.
· Oil slips as demand worries erase early bounce from Saudi price increase
Oil prices slipped on Thursday as global supply and demand worries erased earlier gains seen from an increase in Saudi Arabia’s official crude selling price and a surprise rise in Chinese exports last month.
Brent LCOc1 futures fell 26 cents, or 0.9%, to settle at $29.46 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 lost 44 cents, or 1.8%, to settle at $23.55.
Earlier in the day, Brent was up over 5% and WTI up over 10%. For the week, Brent was still up about 11% and WTI up about 18%.
Both benchmarks have rallied sharply this week as countries have eased coronavirus-related lockdowns and fuel demand has rebounded modestly. Oil production worldwide is also declining to reduce a growing supply glut.
Reference: CNBC, Reuters, BBC
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