· CORONAVIRUS CRISIS:
Ø Total confirmed cases: More than 4,354,545
Ø Total deaths: At least 293,033
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 1,408,636 and deaths: 83,425
Ø Spain cases: At least 269,520 and deaths: 26,920
Ø Russia cases: At least 242,271 and deaths: 2,212
Ø UK cases: At least 226,463 and deaths: 32,692
Ø Italy cases: At least 221,216 and deaths: 30,911
Ø Brazil cases: At least 178,214 and deaths: 12,461
Ø Thailand cases: At least 3,017 and deaths: 56
· Dollar on defensive, negative rates debate puts focus on Powell
The dollar was on the defensive against its rivals on Wednesday as traders looked to Federal Reserve Chairman Jerome Powell’s speech amid rising speculation the United States could one day adopt negative interest rates.
The New Zealand dollar fell to this week’s low after the country’s central bank expanded its asset purchase program and indicated readiness to take further steps — including negative interest rates.
The dollar traded at 107.21 yen, little changed so in Asian trade after having slipped from Tuesday’s peak of 107.76, its highest since April 24.
The euro changed hands at $1.0848 after having gained about 0.4% in the previous session.
“I would advise against negative rates. Japan has done that but the perception here is that it wasn’t so good,” said Hiroyuki Ueno, senior strategist at Sumitomo Mitsui Trust Asset Management.
“But what’s worrying is that Trump is now talking about them. Looking at past examples, the Fed has eventually done what Trump wanted quite often.”
· More than 300 lawmakers urge IMF, World Bank to cancel poor countries' debt
Over 300 lawmakers from around the world on Wednesday urged the International Monetary Fund and World Bank to cancel the debt of the poorest countries in response to the coronavirus pandemic, and to boost funding to avert a global economic meltdown.
The initiative, led by former U.S. presidential candidate Senator Bernie Sanders and Representative Ilham Omar, a Democrat from Minnesota, comes amid growing concern that developing countries and emerging economies will be devastated by the pandemic.
· Europe has new state aid rules — this is how they differ from the 2008 banking crisis
There are now stricter conditions on how European governments can provide financial aid to companies struggling with the ongoing coronavirus crisis.
The European Union adopted new state aid rules in early March as a first step to deal with the economic fallout from the pandemic. These measures were revised for a second time on Friday after long and detailed discussions with the 27 European governments.
The most recent changes to state aid are “different” from what the EU did back in 2008 and 2009 in response to the banking crisis, Paolo Palmigiano, a partner at the law firm Taylor Wessing, told CNBC Tuesday.
· Governments issued more debt than ever last month. How worried should we be?
The economic impact of the coronavirus pandemic prompted governments to issue more debt than ever before in April, according to data provided by the Institute of International Finance.
The Covid-19 outbreak has meant countries have effectively had to shut down, with many governments imposing draconian restrictions on the daily lives of billions of people.
To date, confinement measures have been implemented in 187 countries or territories in an effort to try to slow the spread of the virus. The restrictions are expected to result in the worst economic shock since the Great Depression in the 1930s.
The IIF’s Global Debt Monitor found that global general debt issuance (bonds and loans) hit a record high of $2.6 trillion in April, up from the previous record issuance of $2.1 trillion in March.
· South Korea sticks with virus lockdown rollback despite nightclub outbreak
South Korea health authorities said on Wednesday they had no immediate plans to reinstate strict social distancing rules despite a fresh coronavirus outbreak in the capital of Seoul.
Officials have scrambled to trace and test thousands of people over the past week after a cluster of new infections linked to nightclubs and bars in Seoul’s Itaewon district raised fears of a second wave outbreak.
Officials have linked at least 119 cases of COVID-19 to the night spots, which had just reopened as part of the country’s move to ease lockdown measures to jumpstart its struggling economy.
· UK economy posts sharpest monthly decline on record as coronavirus lockdowns begin to take toll
U.K. GDP (gross domestic product) contracted by 5.8% month-on-month in March, according to preliminary figures released Wednesday, as lockdown measures began to hammer economic activity in the country.
It represents the biggest monthly fall since the series began in 1997, according to the Office for National Statistics (ONS). However, the March reading was still above analyst expectations of a 7.2% decline.
It tipped U.K. GDP into a contraction of 2% for the first three months of the year, quarter-on-quarter, according to the ONS figures, although this was better than the 2.5% expected by analysts.
Prime Minister Boris Johnson announced nationwide lockdown measures from March 23 in a bid to curtail the spread of the coronavirus, which has now infected more than 227,000 people in the country. Johnson this week unveiled a plan for the phased easing of measures over the coming months.
Prime Minister Narendra Modi said on Tuesday that India would provide 20 trillion rupees ($266 billion) in fiscal and monetary measures to support an economy battered by a sweeping weeks-long lockdown to fight the novel coronavirus.
· Goldman Sachs says the only other commodity ‘looking as precarious as oil’ is livestock
The head of commodities research at Goldman Sachs believes the two big commodity stories looking ahead to 2021 and beyond will concern oil and livestock.
The forecast comes at a time when the coronavirus pandemic has prompted many countries across the globe to effectively shut down.
It has created an unprecedented demand shock in energy markets, with U.S. oil prices tumbling into negative territory for the first time ever last month.
Both major oil benchmarks have registered modest gains in recent weeks. However, Brent crude futures and U.S. West Texas Intermediate futures are still down more than 50% on the start of 2020.
“Investors don’t want to hear anything about oil. They have been beaten up, they are done with this space (and) it is going to take a lot to get them to come back,” Jeff Currie, head of commodities research at Goldman Sachs, said during a video call with reporters last week.
The coronavirus outbreak has also wreaked havoc in the food industry, with farmers now facing a pronounced market imbalance.
As a result, Currie said that he believes the only other commodity market “looking as precarious as oil” was livestock.
· Oil falls as fears of second coronavirus wave take hold, U.S. stockpiles rise
The concerns overshadowed a further call by Saudi Arabia for larger production cuts to balance the market following a virus-induced demand slump, after the Organization of the Petroleum Export Countries’ (OPEC) biggest producer said earlier this week it planned to add to output cuts again.
Brent crude LCOc1 dropped 40 cents, or 1.3%, to $29.58 a barrel by 0658 GMT, having risen 1.2% on Tuesday.
West Texas Intermediate crude futures fell 10 cents, or 0.4%, to $25.68 a barrel, after rising 6.8% in the previous session.
New outbreaks have been reported in South Korea and in China, where the health crisis started before spreading around the world, prompting governments to lock down billions of people, devastating economies and demand for oil.
On the supply side, Saudi Arabia’s cabinet has urged OPEC+ countries to reduce oil output further to restore balance in global crude markets, the country’s state news agency reported early on Wednesday.
Kuwait Petroleum Corp (KPC) will export less crude oil in June by requiring customers to cut 5% from the volume of their cargoes in line with the so-called operational tolerance clause in their contracts, two sources with knowledge of the matter told Reuters on Wednesday.
Reference: CNBC, Reuters
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