COVID-19 Numbers and China Trade Data Deliver Early Support as Earnings Season Kicks Off

Earlier in the Day:

It was a quiet start to the day on the economic calendar, with the Aussie Dollar in action.

Outside of the numbers, the markets also responded to the COVID-19 numbers from the weekend and the start of the week.

On Monday, the total number of coronavirus cases across France, Germany, Italy, and Spain rose by 12,827 to 596,466. In the U.S, the total number of cases increased by 25,944 to 586,377. That took the total number of cases globally to 1,923,279.

For the 4 most adversely affected EU member states, it was a 3^rd consecutive daily fall in the number of new cases. A similar trend was also seen in the U.S, with the number of new cases falling for 4 consecutive days. On Monday, 25,944 new cases were reported. There were also reports of NY seeing a plateau in the number of new cases.

For the Aussie Dollar

Business confidence took a hit in March, with the NAB Business Confidence Index sliding from -4 to a record low -66. Economists had forecasted a decline to -15.

The Aussie Dollar moved from $0.64042 to $0.64172 upon release of the figures that preceded trade data out of China. At the time of writing, the Aussie Dollar was up by 0.64% to $0.6423. A rise in commodity prices and improved risk sentiment supporting a move through to $0.64 levels.

Out of China

The U.S Dollar trade balance recovered from a US$7.09bn deficit to a US$19.9bn surplus in March.

• Exports fell by 6.6%, year-on-year, following a 17.2% tumble in February. Economists had forecast a 14.0% decline.
• Imports slipped by just 0.90%, following a 4.0% fall in February. Economists had forecast a 9.5% decline.

Elsewhere

The Japanese Yen was up by 0.11% to ¥107.65 against the U.S Dollar, with the Kiwi Dollar was up by 0.54% to $0.6121.

The Day Ahead:

For the EUR

Its quiet day ahead on the economic calendar, with no material stats due out of the Eurozone to provide direction.

The lack of stats will leave the EUR in the hands of the coronavirus numbers and market reaction towards the €500m EU stimulus package.

Falling COVID-19 numbers are EUR positive and will likely offset any negative sentiment towards the EU Stimulus package.

At the time of writing, the EUR was up by 0.29% at $1.0946.

For the Pound

It’s also a quiet day ahead on the economic calendar, with no material stats due out of the UK later today.

The lack of stats will leave the Pound in the hands of COVID-19. Boris Johnson’s release from hospital is Pound positive, with risk appetite also Pound positive.

At the time of writing, the Pound was up by 0.39% to $1.2564.

Across the Pond

It’s a quiet day ahead on the U.S economic calendar, with March import and export price index figures due out later today.

We would expect the numbers to have a muted impact on the Dollar, with the market focused economic data and corporate earnings in the week ahead.

Neither are likely to be Dollar positive that contributed to the downside on Monday.

Expect COVID-19 numbers to also provide direction on the day. Falling numbers eased demand for the Greenback this morning.

The Dollar Spot Index was down by 0.16% to 99.189 at the time of writing.

For the Loonie

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

The BoC is in action this week, with dire economic data suggesting the need for more monetary policy support.

While the latest bid by OPEC and world oil producers to support price stability was Loonie positive, concerns over the size of the cut will raise some concerns.

An extended lockdown across the world’s major economies has weighed heavily on demand, which is estimated to dwarf the 10m bpd cut.

Talks of further cuts in production and “risk-on” sentiment provided support early.

The Loonie was up by 0.24% at C$1.3870 against the U.S Dollar, at the time of writing.