(01 April 2020)DAILY MARKET BRIEF 2:The US dollar index shortly fell
The US dollar index shortly fell below the 99 mark on Tuesday. But if the equity markets are hit by a renewed wave of a global sell-off, the US
dollar will certainly be the first destination to welcome the freed cash.
On the other hand, no matter the deterioration in the US
data, the Federal Reserve (Fed) can hardly pledge to do more than buying an unlimited amount of assets and debt as a response. As such, the
expectation of ugly economic data and further market headwinds keep US treasuries in demand. The US 10-year yield stands at 0.627%.
The
EURUSD remains capped below its 200-day moving average, 1.1050. The British pound trades a touch below the 1.25 mark against the greenback.
Gold
retraced to $1566 per oz but the yellow metal could regain the $1600 handle on the back of increased safe haven flows.
Meanwhile, the sell-off in
emerging market currencies should accelerate with EM central banks and governments announcing policy easing measures despite facing a
sure downgrade of their credit rating in the foreseeable future.
By Ipek Ozkardeskaya
