Investors
resorted to safe havens on Thursday, as fears of the corona epidemic
intensified, with the rise in infected cases to 15,000 and deaths toll to 240
deaths, causing panic in financial markets.  

Classic
safe haven assets such as the yen, franc and gold strengthened against major
currencies, while Asian stocks failed to track the suit of their U.S.
counterparts overnight.

While
the U.S. dollar is sometimes treated as a safe haven, when worries deepen,
investors mainly rush to classic refuges as they still offer the highest
security level during times of panic.

The
U.S. dollar fell 0.3 percent against the yen to trade at 109.75, noting that
the pair recorded a high of 110.13 on Wednesday, the highest since January 21.

Against
the Swiss franc, the dollar slipped 0.12 percent to 0.9770, while the dollar
index, which tracks the green currency’s movements versus a basket of major
currencies, dipped 0.12 percent to 98.80.

Gold
climbed to a top of $1576.99 an ounce today, erasing nearly all the losses
incurred over the previous three sessions.

Cryptocurrencies,
recently deemed as refuge assets, continued to trade higher, where the Bitcoin
hit $10,500, while the Ripple surged 12.78 percent to $0.3252, according to
CoinMarketCap. 

Market
participants are currently assessing the economic damage from the spread of the
coronavirus as Barcelona canceled the annual Mobile World Congress conference
that hosts 100,000 visitors.

Also,
China closed a refinery and suffered from a plummet in auto sales due to the
rise in deaths and infected cases.

In
his second day of testimony, Fed Chain Jerome Powell said the central bank was
carefully watching the latest developments of the coronavirus and pointed to
readiness to use QE measures and forward guidance in the event of an economic
downturn.

Later in the day, the
EU Commission will release its newest economic forecasts for the euro bloc and
the U.S. will publish the consumer price index for January.

LEAVE A REPLY

Please enter your comment!
Please enter your name here