SHANGHAI, Mar 20 (SMM) – This is a roundup of global macroeconomic news last night and what is expected in the day ahead.
The US dollar rose against a basket of currencies for a third straight day on Thursday, to its highest since January 2017, as worries about the economic fallout from the coronavirus boosted dollar demand despite recent steps by world central banks aimed at alleviating market stress.
US stocks closed higher Thursday, erasing steep losses from earlier in the day, while oil prices rebounded from almost two-decade lows plumbed on Wednesday.
London base metals recovered from steep losses earlier in the day to close mixed. Copper jumped 1.6% on the day, and tin gained 0.4%, while lead dropped 1%, nickel fell 0.8%, zinc shed 0.7% and aluminium lost 0.6%.
The Shanghai Futures Exchange kept its night trading session suspended to contain the spread of the virus, even as China reported no new domestic cases on Thursday.
The Bank of England announced another surprise interest rate cut on Thursday and ratcheted up its bond-buying program, in an effort to offset the economic impact of the coronavirus outbreak.
This came after the European Central Bank announced a new Pandemic Emergency Purchase Programme on Wednesday night that will deploy 750 billion euros to purchase securities to help support the European economy.
The Fed announced earlier this month plans to pump an additional $1 trillion into the US economy through asset purchases and cut the federal funds rate to zero.
US President Donald Trump signed Wednesday a bill that that expands paid leave for workers during the coronavirus crisis. That bill was signed as the administration and lawmakers iron out a stimulus package potentially worth $1 trillion.
Data published Thursday showed German business sentiment plummeting in March. The preliminary ifo Business Climate Index plummeted from 96.0 points in February to 87.7 points in March, the biggest drop since 1991 and bringing the index to its lowest level since August 2009.
Filings for US unemployment benefits surged last week to a two-year high as the coronavirus pandemic forced employers to start laying off workers.
The US Labor Department reported Thursday that jobless claims rose by 70,000 to 281,000 in the week ended March 14. That’s the biggest one-week increase since the aftermath of Hurricane Sandy in 2012.
US current account deficit, which reflects the combined balances on trade in goods and services and income flows between US residents and residents of other countries, narrowed by $15.6 billion, or 12.4%, to $109.8 billion in the fourth quarter of 2019, according to statistics from the US Bureau of Economic Analysis (BEA). The revised third quarter deficit was $125.4 billion. The fourth quarter deficit was 2% of current dollar gross domestic product (GDP), down from 2.3% in the third quarter.
The monthly fixing of China’s Loan Prime Rate (LPR) is expected to be out around 9:30 am Beijing time.
Economic data slated for release today include US existing home sales in February and the eurozone’s current account for January.