CORONAVIRUS UPDATES:
- Total confirmed cases: More than 182,438
- Total deaths: At least 7,157
- Affecting 162 countries and 1 international conveyance (the Diamond Princess cruise ship).
- US cases: At least 4,736, and deaths: 93
- Italy cases: At least 27,980, and deaths: 2,158
- Iran cases: At least 14,991, and deaths: 853
- Thailand cases: At least 177, and deaths: 1
· The Japanese government will ask all travelers from Europe, including its own citizens, to quarantine themselves for two weeks on arrival, TV Asahi reported on Tuesday.
The government also will begin refusing entry of foreign nationals who have been in certain areas of Spain, Italy and Switzerland, as well as all of Ireland, the report said.
· Georgia will close all public schools starting Wednesday
Georgia Gov. Brian Kemp has ordered all public schools to close starting Wednesday until March 31.
· Serge Telle, the state minister of Monaco, has tested positive for the coronavirus, according to the principality's Ministry of Health.
· Hong Kong will quarantine for 14 days all people entering the city starting midnight on Thursday to prevent an “explosion” of coronavirus cases around the world compromising one of the world’s most successful outbreak limitation campaigns.
· Australian researchers said on Tuesday they have mapped the immune responses from one of country’s first coronavirus patients, findings the health minister said were an important step in developing a vaccine and treatment.
As scientists scramble to develop a vaccine, researchers at Australia’s Peter Doherty Institute for Infection and Immunity said they had taken an important step in understanding the virus.
By examining the blood results from an unidentified woman in her 40s, they discovered that people’s immune systems respond to coronavirus in the same way it typically fights flu.
The findings help scientists understand why some patients recover while others develop more serious respiratory problems, the researchers said.
· German Economy Minister Peter Altmaier told German broadcaster RTL that he expected the coronavirus crisis to last until the end of May.
“I expect we’ll have to deal with the consequences for the whole month of April and the whole month of May,” he said, adding there would be a “considerable number of new infections” during that time.
· The safe-haven Japanese yen ticked down and some risk currencies won a brief reprieve on signs of more economic support from policymakers, though choppy conditions on Tuesday underlined fragile confidence in markets frazzled by days of turbulence.
Market liquidity was light and investors remained nervous after coordinated moves by central banks had spectacularly failed to quell trepidation over the coronavirus pandemic.
The dollar rose 0.5% to 106.32 yen JPY=, having risen as much as 1.3% to 107.185 as U.S. stock futures ESc1 bounced back 3% after a 10% fall of more than 10% the previous day. Still, the dollar was down 1.6% so far this week
The euro stood flat at $1.1180 EUR=, after wild gyrations on Monday.
· New Zealand said it would pump NZ$12.1 billion (5.97 billion pounds), or 4% of gross domestic product, into the economy to slow a contraction expected from business disruptions caused by the coronavirus outbreak.
In the United States, Boeing Co (BA.N) confirmed it is in talks with senior White House officials and congressional leaders about short-term assistance for itself and the entire aviation sector.
The New Zealand dollar NZD=D4 rose as much as 0.8% before giving up most of its gains to stand at $0.6048, off a 11-year low below $0.60 touched on Monday.
· The British pound is also under pressure, dogged by worries about not only Britain’s exit from the European Union but also its sizable current account deficit.
Sterling traded at $1.2250 GBP=D4, down 0.2% and near a five-month low of $1.2203 hit in the previous session.
· EUR/USD Price Analysis: Looks north after strong bounce from key Fib
EUR/USD's pullback from recent highs near 1.15 looks to have ended with Monday's strong bounce from the key support and the spot could challenge the psychological resistance of 1.12.
On Monday, the pair found bids near 1.1052 - the 61.8% Fibonacci retracement of the rally from Feb. 20 low to March 9 high - and closed out with 0.69% gains. The Fibonacci support also held ground on Thursday and Friday.
The repeated bear failure to price support and the subsequent bounce has revived the immediate bullish setup. A break above 1.12 would open the doors to 1.1237 (Monday's high). A close higher would further confirm bullish revival and expose the recent high of 1.1495 (March 9 high).
Alternatively, a close under 1.1052 is needed to put the sellers into the driver's seat. The pair is currently trading at 1.1167, representing marginal gains on the day.
· USD/JPY Price Analysis: Off session highs, stuck in a narrowing price range
USD/JPY is currently trading at 106.34, having hit a session high of 107.19 an hour ago.
While the pair has pulled back from session highs, it is still reporting a 0.50% gain on the day.
More importantly, the pair has so far traded well within Monday's trading range of 107.57 to 105.15, which fell within Friday's high and low of 108.50 to 104.50, respectively.
Essentially, the spot is trapped in a narrowing price range. A breakout above 107.57 (Monday's high), if confirmed, would imply a continuation of the rally from recent lows near 101 and open the doors to the psychological hurdle of 110.00. On the way higher, the pair could encounter resistance at 108.50 (Friday's high),
Alternatively, a close below 105.15 would imply a range breakdown would shift risk in favor of a re-test of the recent low of 101.18 (March 9 low).
· US Q1 GDP growth forecast slashed to 0% vs. 0.7% previous due to coronavirus – Goldman Sachs
In a note to clients late Sunday, Jan Hatzius, Goldman’s Chief Economist, revised down the outlook for the economy in the first two quarters of 2020 due to the coronavirus impact.
Key quotes
“Lowered his first-quarter GDP growth forecast to zero from 0.7%.
Sees a 5% contraction in the second quarter, followed by a sharp snapback for the remainder of the year.
We expect US economic activity to contract sharply in the remainder of March and throughout April as virus fears lead consumers and businesses to continue to cut back on spending such as travel, entertainment, and restaurant meals.
The US economic growth should pick up in the second half of 2020.
Expects GDP growth of 3% in the third quarter and a 4% expansion in the final three months of the year.
Factoring in his new estimates, for 2020 he sees the economy growing 0.4%, compared with a prior growth estimate of 1.2%.
· Goldman cuts first quarter GDP estimate for China, sees 9% contraction vs +2.5% earlier
Goldman Sachs cut its estimate for China’s first quarter gross domestic product to a year-on-year contraction of 9% from a previous forecast of 2.5% growth, citing “strikingly weak” economic data in January and February.
Goldman said it did not expect GDP to return to the pre-virus trend until the third quarter.
It lowered its full-year GDP forecast to 3% growth from a previous estimate of 5.5
· Bank of Japan Governor Haruhiko Kuroda said on Tuesday the central bank would ease monetary policy again if the economy worsened further from the fallout of the coronavirus outbreak.
“If the economy worsens further, we will take additional monetary easing steps,” Kuroda told parliament.
· Japan sales tax cut emerging as option as Abe government battles coronavirus fallout
Japan will consider various measures, including tax cuts, to deal with deepening damage to its economy from the coronavirus outbreak, economy minister Yasutoshi Nishimura said on Tuesday, amid growing debate on the possibility of cutting sales tax.
A group of ruling party lawmakers last week proposed that the government temporarily eliminating altogether Japan’s 10% sales tax and preparing a 30 trillion yen ($282 billion) supplementary budget for spending to address the hit to economic growth from the health crisis.
Although extreme, the proposal highlights the seriousness of issues facing the world’s third-biggest economy, and has not been shot down completely by government officials like Nishimura.
The government’s decision to implement a long-mooted increase in sales tax to 10% from 8% in October has been widely blamed for hurting the world’s third-biggest economy, which shrank an annualized 7.1% in the final quarter of last year.
· Moody’s 2020 forecasts no growth in Japan and Singapore, slower growth in China
Moody’s Investors Service is out with the latest revision to the 2020 Asia-pacific growth forecasts, factoring in the huge negative economic impact of the coronavirus outbreak.
Key quotes
“Revised 2020 forecasts highlight no growth in Japan and Singapore, slower growth in China, and contractions in Hong Kong.
Risks for APAC firmly tilted to the downside, including from much weaker European and American economies than currently assumed.
Forecast of 4.8% growth for China assumes slow resumption of economic activity and weak export demand.”
· China’s economy will return to normal in the second quarter as government support measures to mitigate the impact of the coronavirus epidemic take effect, the state planner said on Tuesday.
Officials from the National Development and Reform Commission (NDRC) also told reporters during a briefing that China has ample policy tools and will roll out relevant measures at an appropriate time.
· Oil prices jump $1 as sharp falls draw investors, bargain buyers
Oil rose more than $1 on Tuesday as bargain hunters emerged after recent sharp falls due to the coronavirus pandemic and the price war between Saudi Arabia and Russia, but fears of a recession still dragged on the market.
Brent crude LCOc1 was up by 1.8%, or 55 cents, to $30.60 a barrel by 0410 GMT, after hitting a high of $31.25.
U.S. West Texas Intermediate (WTI) crude CLc1 rose 3.7%, or $1.06, to $29.76, having come off a high of $30.21.
“Presumably, the market is getting supported by physical bargain hunters and short covering,” said Stephen Innes, chief markets strategist at AxiCorp.
Reference: Reuters, CNBC, FXStreet
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