Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Forex - Dollar Gains as Virus Cases Grow, For Now

ForexJul 10, 2020 03:21AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Peter Nurse

Investing.com - The dollar pushed higher in early European trade Friday, helped by its safe haven status as coronavirus cases continued to surge in the United States and unemployment data pointed to a slow recovery in the labor market.

At 3:15 AM ET (0715 GMT), the dollar index, which tracks the greenback against a basket of six other currencies, was up 0.3% at 96.915. GBP/USD was down 0.2% at 1.2580, while USD/JPY was down 0.3% at 106.84. 

The number of coronavirus cases in the U.S., the world’s economic engine, continues to grow, with more than 60,000 new Covid-19 infections reported on Thursday.

With populous states like California, Florida and Texas recently breaking records, and having to restart some social distancing measures, hopes are fading for an aggressive economic revival.

The number of Americans filing for jobless benefits dropped more than expected last week, data showed Thursday, but the figure remained above one million for the 16th straight week. Continuing claims also remained above 18 million, suggesting the labor market would take years to recover from the pandemic.

However, while the dollar gained against the euro Friday--EUR/USD was down 0.2% at 1.1263--it’s still a little lower against the single currency year to date. And further losses look likely.

“Recent virus problems in the U.S. present a material risk to the U.S. recovery in the coming months, whereas the euro area service sector recovery is set to continue barring any second virus waves during the European holiday season,” said analysts at Danske Bank, in a research note.

Danske Bank calls for EUR/USD to reach 1.15 on a one-three month time frame.

Adding to the sense of a European recovery, French industrial production increased sharply in May, up 19.6%, as lockdowns were eased and factories reopened.

Attention will now turn to the meeting of the EU leaders next week, to see if there can be agreement allowing the proposed 750 billion euro recovery fund to be distributed to the economies hit hardest by Covid-19 in the region, although also of interest with be Fitch's review of its credit rating for Italy.

"The question is whether Fitch decides to be tough and downgrade Italy. We expect that it will remain on hold given that the ECB and EU are showing strong support for Italy through QE and the expected recovery fund," said Danske Bank.

Elsewhere, the risk-linked Antipodean currencies gave up their gains from the previous day, with the AUD/USD pair down 0.5% to 0.6932 and the NZD/USD pair falling 0.12% to 0.6555, while the USD/CNY pair gained 0.3% to 7.0115.

Forex - Dollar Gains as Virus Cases Grow, For Now
 

Related Articles

Column: Dollar smiling from ear to ear
Column: Dollar smiling from ear to ear By Reuters - Sep 22, 2021

By Mike Dolan LONDON (Reuters) - Whether investors run for the hills or not after the past week's stock market shakeout, the episode provides a glimpse of where to run for cover -...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (5)
Jay Khaye
Jay Khaye Jul 12, 2020 10:47PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
So let me get this straight ! Higher virus cases is good for the dollar.  ****
Matt Kay
Matt Kay Jul 10, 2020 8:31AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
For now? Virus will never leave the states. Even if vaccine is developed trumpists will say that it is full of poison or some nonsense.
Elvis Durant
Elvis Durant Jul 10, 2020 7:31AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
"For now"......
Andrew carson
Andrew carson Jul 10, 2020 6:52AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Paper with a number on it.
Bullish Bear
Bullish Bear Jul 10, 2020 4:04AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Cool
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email