Forex news for North American trade on March 27, 2020:
- Bank of Canada cuts rates to 0.25%, launches QE program
- Poloz: Policy rate is now at the effective lower bound
- Bank of Canada full rate statement from the March 27 rate cut
- UK coronavirus cases rise to 14,579 vs 11,658 yesterday
- New York state coronavirus cases 44,635 vs 37,258 yesterday
- Italy reports 969 deaths today vs 662 yesterday
- US U Mich March final consumer sentiment 89.1 vs 90.0 expected
- CFTC commitments of traders: EUR longs at the highest level since June 2018
- Federal Reserve considering more steps to help state and local governments
- ECB recommends that banks don't pay dividends until at least October
- Canada fin min Morneau: To offer gov't-guaranteed loans to Canadian oil
- Baker Hughes US oil rig count 624 vs 664 prior
- Canada reports 4,043 coronavirus cases vs 3,197 yesterday
- US regulators let banks delay capital hit from loan loss accounting rule
- Trudeau: Canada to offer businesses $40,000 interest-free loans for a year
- Canada January non-farm payrolls +64.9K
- US February personal spending +0.2% vs +0.2% expected
- UK PM Boris Johnson tests positive for the coronavirus
- Spain reports deadliest day of the coronavirus outbreak with 769 deaths
Markets:
- Gold down $9 to $1622
- WTI crude down $1.01 to $21.60
- US 10-year yields down 16 bps to 0.68%
- S&P 500 down 89 points to 2541
- GBP leads, USD lags
Wave after wave of US dollar selling was the theme again as last week's funding-driven gains unwind following central bank action. Even the Bank of Canada cutting rates and launching QE could halt it, although CAD was the second-worst performer.
Flows continue to dominate fundamentals and quarter-end is a part of that.
The snap back in the pound has been equal to the cratering a week ago. It rallied another 250 pips today with the bulk of the move coming late in the day.
The euro made a big comeback from a drop down to 1.0950 at the start of New York trade. It found a relentless bid there and climbed all the way to 1.1140. The daily chart shows the extent of the volatility.
The dollar finished on the lows except against the commodity currencies where some late selling in stocks, in part on the Fed's diminished plans to buy bonds weighed.
USD/JPY fell for the second day after breaking out of the consolidation around 111.25. The pair sank another 165 pips and broke 108.00.
Despite the dollar weakness, gold was unable to find a bid. It chopped around $1620 all day. A few forays to $1630 fell flat.
