Forex news from the European morning session - 31 January 2020
Headlines:
- Singapore suspends entry to all travelers with recent travel history to China
- Eurozone Q4 preliminary GDP +0.1% vs +0.2% q/q expected
- Eurozone January preliminary CPI +1.4% vs +1.4% y/y expected
- Italy set to declare state of national emergency after confirming first two cases of the new coronavirus
- First two cases of the new coronavirus confirmed in the UK
- Japan's Abe: Foreigners who have visited Hubei province within last 14 days to be barred from entering
- Thailand confirms first coronavirus case of local person-to-person transmission
- Italy Q4 preliminary GDP -0.3% vs +0.1% q/q expected
- Spain Q4 preliminary GDP +0.5% vs +0.4% q/q expected
- Germany December retail sales -3.3% vs -0.5% m/m expected
- France Q4 preliminary GDP -0.1% vs +0.2% q/q expected
Markets:
- GBP leads, AUD and NZD lag
- European equities lower; E-minis down 0.4%
- US 10-year yields down 3 bps to 1.556%
- Gold up 0.4% to $1,579.85
- WTI up 0.8% to $52.58
- Bitcoin down 2.8% to $9,289
Risk remains the main story in markets as coronavirus concerns continue to reverberate across the world, as we see the first two cases being reported in the UK and the likes of Singapore, Japan and Italy stepping up action to prevent the virus from spreading.
European stocks got off to a good start but retraced gains thereafter, as US futures fell and bonds also were bid during the session.
USD/JPY eased from 109.05 to 109.90 while we see the likes of the aussie and kiwi stay pressured with AUD/USD tracking back under 0.6700.
Meanwhile, the pound is keeping more steady after the BOE decision yesterday as cable shakes off the 1.3100 level but is still unable to chase gains ahead of 1.3150.
The euro also brushed aside a sluggish Q4 as we saw the French and Italian economies contracted, but EUR/USD crept higher from 1.1020 to 1.1045 on month-end flows.
Looking ahead, it is all about risk as we approach the weekend and the scenario is a perfect test once again for Wall Street dip buyers and their resolve later today.
Have a great weekend, everyone!
