A flight to safety theme emerged in Asia this Thursday after the appetite for risk assets was killed by a surge in new coronavirus cases in China’s Hubei province. The epicentre reported 14,840 new cases after implementing a change to the counting method, as to account for the number of “clinically diagnosed” patients.
Amid renewed coronavirus fears, the Asian stocks dropped in tandem with the US equity futures and Treasury yields while the safe havens such as gold and the yen benefited the most.
Within the currency basket, the Japanese yen bounced-off a three-week low vs. the greenback, having dragging USD/JPY back below the 110.00 handle. Among the European currencies, the EUR/USD pair remained vulnerable near a 33-month low of 1.0865 reached a day before. GBP/USD traded on the back near 1.2950 amid persistent broad US dollar strength, with the DXY stuck near a four-month high of 99.05.
Gold is flashing green amid risk-off tone in equities as renewed coronavirus scare has likely put a bid under haven assets. WTI trades near $51.55, following the intra-day low to $51.12, during the early session on Thursday. The energy benchmark recently responded to the sharp increase in coronavirus cases from China’s Hubei.
There is nothing of note, in terms of the economic events, in the EUR calendar today. The revival of the coronavirus scare will continue to drive the broader market sentiment amid a lack of fundamentals from the UK docket as well.
The USD traders will eagerly await the US CPI report, due at 13:30 GMT, for the next direction, considering the recent upsurge. Also, the second-tier US weekly Jobless Claims data will drop at the same time. Next of note remains the speech by the European Central Bank (ECB) policymaker Panetta for some near-term trading impulse.