As Governments Look to Ease Measures, the EU Project and EUR Remain Under Fire

Earlier in the Day:

It was a relatively quiet start to the day on the economic calendar this morning. Economic data was limited to March inflation figures out of Japan.

The lack of stats left the Asian markets to take their cues from the U.S session overnight, Thursday’s COVID-19 numbers, and crude oil prices this morning.

On Thursday, the number of new coronavirus cases rose by 80,696 to 2,715,614. This was up marginally from a 78,442 increase on Wednesday.

France, Germany, Italy, and Spain reported 8,068 new cases on Thursday, which was down from 11,603 new cases on Wednesday. From Germany and Spain, it was a 3^rd consecutively daily increase. In spite of this, the daily increases remained well below the numbers seen last week.

From the U.S, the total number of cases rose by 30,926 to 879,430. On Wednesday, the total number of cases had risen by 29,760. On Thursday of last week, the total number of new cases in the U.S had risen by 31,292.

The continued downward trend from last week and plans to ease lockdown measures remained market positive.

Negative updates on drug trials to treat coronavirus patients was a test early on, however.

For the Japanese Yen

The annual rate of core inflation softened from 0.6% to 0.4% in March, according to figures released by the Ministry of Internal Affairs and Communication. Economists had forecast an annual rate of core inflation of 0.4%.

Month-on-month, consumer prices stalled in March after having fallen by 0.1% in February.

The Japanese Yen moved from ¥107.649 to ¥107.64 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.06% to ¥107.66 against the U.S Dollar,

Elsewhere

At the time of writing, the Aussie Dollar was down by 0.20% to $0.6357, with the Kiwi Dollar down by 0.25% to $0.5993.

The Day Ahead:

For the EUR

It’s a quieter day ahead on the economic calendar. Economic data is limited to Germany’s IFO Business Climate Index numbers for April.

Following particularly dire April PMI numbers yesterday, expect today’s numbers to have a limited impact on the EUR.

As EU member states roll out plans to ease lockdown measures, the focus will now be on EU member states delivering a meaningful aid package. The EUR hit reverse on Thursday as EU member states failed to agree on a sizeable stimulus package to counter the economic effects of COVID-19.

At the time of writing, the EUR was down by 0.09% to $1.0767.

For the Pound

It’s a relatively busy day ahead on the economic calendar. March retail sales figures are due out that could test the Pound early in the day.

While more stringent containment measures were introduced in April, the March numbers are forecasted to be quite dire.

Following the April PMI numbers on Thursday, however, the markets may be able to stomach another shocking set of numbers.

Over the course of the day, expect the Pound to remain sensitive to COVID-19 numbers, with risk sentiment the key driver.

At the time of writing, the Pound was up by 0.03% to $1.2348.

Across the Pond

It’s a relatively busy day ahead on the U.S economic calendar. Key stats include March durable goods orders and finalized consumer sentiment numbers for April.

A marked slide in durable goods orders in March is forecasted, which will likely have a limited impact on the Dollar.

Finalized consumer sentiment numbers will likely be revised downwards, which should also be brushed aside.

With economic data likely to have limited impact, the focus will remain on Capitol Hill…

The Dollar Spot Index was up by 0.15% to 100.570 at the time of writing.

For the Loonie

It’s a quiet day on the economic calendar, with no material stats due out to provide the Loonie with direction.

The lack of stats will leave the Loonie in the hands of market risk appetite and crude oil prices. While crude oil prices saw early gains this morning, the cause was rising tensions in the Middle East, which was Loonie negative.

The Loonie was down by 0.08% to C$1.4084 against the U.S Dollar, at the time of writing.