By Alex Ho
Investing.com - The U.S. dollar inched up on Wednesday in Asia, but the gains were capped as Federal health authorities warned that they expect a wider spread of the coronavirus in the state.
Nancy Messonnier, director of the National Center for Immunization and Respiratory Diseases at the Centers for Disease Control and Prevention (CDC), said in a news briefing that the agency expects a sustained transmission of the virus and called for citizens to plan for potential outbreak.
“We are asking the American public to work with us to prepare, in the expectation that this could be bad,” Messonnier said.
Cities and towns should plan for “social distancing measures,” like dividing school classes into smaller groups of students or closing schools altogether. Meetings and conferences may have to be canceled, she said.
However, the health authorities said they are unsure about how severe the health threat could be.
U.S. stocks plummeted following her remarks. The dollar also fell overnight but recovered slightly on Wednesday in Asia.
The U.S. dollar index that tracks the greenback against a basket of other currencies inched up 0.1% to 98.968 by 12:50 AM ET (04:50 GMT).
The worsening prospect of the virus situation prompted bets that the Federal Reserve to act in the coming months.
The odds of April, June, and July rate cuts jumped to 61.6%, 78% and 86.3% respectively, according to Investing.com'sFed Rate Monitor Tool.
The Fed said earlier this week that it was “still too soon” to say whether the situation will result in a material change to the outlook.
Meanwhile, the USD/JPY pair gained 0.2% to 110.38 even as Asian equities traded mostly lower today.
The AUD/USD pair dropped 0.2% to 0.6590, while the NZD/USD pair was little changed at 0.6318.
The USD/CNY pair edged up 0.1% to 7.0197.