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The Greenback is back on top of the food chain this week. This is likely due once again to the coronavirus fears sparking demand for U.S. dollars in both risk sentiment terms, as well as liquidity terms for banks and companies needing the reserve currency to keep businesses and funding flowing.
United States Headlines and Economic data
Monday:
- US coronavirus cases top 500 as Oregon joins list of states declaring emergencies
- New York Fed raises size of repo operations for this week
- Massive risk-off sentiment right the start of the week after Saudi Arabia Stuns the world with massive oil discounts in all-out price war was the likely catalyst for the U.S. dollar to pop higher against the comdolls, while falling to the safe haven / low-yielders at the open of trading.
Tuesday:
- White House plan for economic response to coronavirus is ‘not there right now,’ officials say
- Trump vows aid to airline, cruise ship industries
- Trump proposes eliminating payroll tax through the end of the year
- The Greenback slowly moved higher during the Tuesday session as traders began to speculate on potential stimulus moves coming from central banks and governments to combat the coming economic damage from the fast spreading coronavirus, likely weakening the other major currencies.
Wednesday:
- US consumer prices grew 0.1% in February as food costs rose
- Rising food costs lift U.S. consumer prices in February
- Joe Biden wins big in Michigan, three other states
- Dollar slides as Trump’s virus response disappoints
Thursday:
- U.S. weekly jobless claims fall; producer prices weak
- U.S. producer prices post biggest drop in five years
- Strong move higher in the Greenback on Thursday, likely a reaction to risking global risk sentiment, which was sparked by a negative reaction to the U.S.’ coronavirus response, and possibly on the likelihood traders were disappointed that the ECB didn’t do more to stimulate the economy (i.e., no expected rate cut) in their latest monetary policy actions.
Friday:
- Consumer sentiment tumbles in March as coronavirus threat explodes into view
- U.S. House to pass coronavirus aid bill, Republican support unclear
- Fed starts bond purchases under ramped up liquidity program
- Trump declares national emergency over coronavirus
- Strong close for the week in the Greenback, which may be attributed to the spike higher in demand for U.S. dollars by banks and companies as the coronavirus strains the global financial system.