- Stocks crash as on virus and oil price crash
- Oil linked currencies drop heavily
- GBP swings on Monday morning
- The Yen soared on Monday morning as investors were sent running into safety as coronavirus fears heightened and oil prices plunged. Currently sitting at a three year high against a basket of currencies, the yen cemented its current status of the safest currency to own purely on the basis it is the worlds biggest creditor.
- Then number of people infected with coronavirus topped 107,000 and as such the markets are bracing for further disruption.
The pound lost significant ground on Monday morning only to gain it back as stock markets tank. GBPEUR opened to a five month low of 1.14 from 1.1553 over the weekend. As the virus and stocks continue to cause disruption, investor may stay away from perceived riskier currencies. The Pound is highly reliant on inflows of investor capital to maintain its value and whenever these inflows of capital decline the Pound loses support. The current coronavirus-inspired meltdown in stock markets has seen global investors turn more bearish which inevitably means inflows of foreign investor capital into the UK could be at risk of drying up.
- The euro jumped after U.S treasury yields dropped and export sensitive currencies fell. The single currency continues to charge higher erasing all gains made by the pound, dollar and various other currencies since the start of 2020.
- The dollar continued its decline on Friday and into the new week – GBPUSD hit a new high of 1.32, and EURUSD continues its charge higher at 1.1420. Markets are anticipating further rate cuts by the Fed and as such, the safe haven sttus the dollar enjoyed over the early part of the year has diminshed.