FX Update: USD and JPY rise to top on negative sentiment shift.
Widening concerns that the Covid-19 virus outbreak will lead to a more sustained risk of economic disruption is feeding a fresh wave of risk aversion, as safe haven bonds in particular flash red even if the dip in sentiment elsewhere is far modest. The JPY is pulling to the head of the pack on the double whammy of lower yields and risk-off.
Macro Dragon: US is Back, RBA mins, ZEW, Empire...
Macro Dragon = Daily Cross Asset Views. We take a look at the overnight session that saw a massive GDP miss from Japan. Touch on the continued Risk-On that we are seeing in Equities - CH & HK stocks pretty much back to pre-virus news, yet USDCNH at 6.98 well off the 6.84 lows post the signing of the Phase One deal earlier in April. Today watch out for RBA mins early doors Asia, as well as ZEW data on Germany & the Eurozone, Jobs data out of the UK, Mfg. Out of CA & Empire out of the US.
FX Update: Sterling rises on fiscal stimulus hopes
Most currencies are taking their orders from intermarket signals, as commodities have bounced and risky assets continue to look beyond the Covid-19 virus impact. Some of the first more significant data showing the virus impact outside of China up later this week. Meanwhile, sterling strength is one of the few developments of note within G10 FX.