FOREX-Dollar falls before jobless claims, investors await stimulus

Reuters

Warning: This material has been prepared by a third party company, Reuters, which is independent of Davy. Davy has not reviewed the material and accepts no responsibility for errors or omissions, or for the information or opinions contained therein. It does not constitute investment advice.

    * Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
    * U.S. weekly jobless claims in focus
    * Investors await word on U.S. stimulus vote
    * Coronavirus is ravaging global economy

    By Stanley White
    TOKYO, March 26 (Reuters) - The dollar fell against the yen
and the euro on Thursday before data expected to show a surge in
U.S. claims for unemployment benefits as companies lay off
workers due to the rapid spread of the coronavirus.
    The pound extended declines against the euro and the dollar
due to worries that Britain is not prepared to deal with an
increase in coronavirus cases after the flu-like illness ravaged
health care systems in Italy and Spain.
    The Australian and New Zealand dollars, both of which are
closely liked to the global commodity trade, fell against their
U.S. counterpart as traders avoided taking on excessive risk.
    Investors are anxiously awaiting the passage of a $2
trillion U.S. stimulus package to offset the economic impact of
the coronavirus pandemic, but there are already indications that
some U.S. states will need more money for medical supplies as
the health care system struggles to cope.
    "It could be difficult for the markets to digest weekly
jobless claims," said Tohru Sasaki, head of Japan markets
research at JP Morgan Securities in Tokyo.
    "Bad numbers are expected and priced in to a certain extent,
but there are people who think things will get even worse. In
the end this may support the dollar as investors choose to bring
their money home."
    The dollar fell 0.47% to 110.69 yen  JPY=EBS  in Asia on
Thursday.
    Against the Swiss franc  CHF=EBS , the dollar eased slightly
to 0.9752.
    Sterling  GBP=D3  fell 0.3% to $1.1837 and fell 0.6% to
92.11 pence per euro  EURGBP=D3 .
    The pound's losses accelerated early in Asian trade after
the British government said the total number of coronavirus
cases in the UK rose to 9,529 on Wednesday from 8,077 the
previous day.  urn:newsml:reuters.com:*:nL4N2BI5OE
    U.S. weekly jobless claims due later on Thursday are
expected to rise to around a million, which would be well above
the previous peak seen during the global financial crisis.
    Some analysts say jobless claims could even exceed one
million as companies are expected to rapidly shed workers.
    Draconian restrictions on personal movement aimed at slowing
the spread of the coronavirus are widely expected to cause a
global recession.
    Federal Reserve Chairman Jerome Powell is scheduled to speak
on U.S. television at 1100 GMT, which may provide more
information about policymakers' response to the pandemic.
    Republicans and Democrats in the U.S. Senate are expected to
vote on Wednesday on a $2 trillion emergency package that U.S.
President Donald Trump is expected to swiftly sign the bill into
law.  urn:newsml:reuters.com:*:nL1N2BI0KN
    The euro  EUR=EBS  rose 0.2% to $1.0901 in Asia on Thursday.
The common currency held on to gains against the Swiss franc
 EURCHF=EBBS , trading at 1.0638.
    The German lower house on Wednesday suspended the country's
debt brake and approved a debt-financed supplementary budget of
156 billion euros to pay for healthcare and keep companies
afloat.  urn:newsml:reuters.com:*:nL8N2BI748
    Singapore's economy suffered its biggest contraction in a
decade in the first quarter, data showed on Thursday, as the
coronavirus pandemic prompted the city-state to cut its
full-year GDP forecast and plan for a deep recession.
 urn:newsml:reuters.com:*:nL4N2BJ020
    The Singapore dollar  SGD= , which already hit the lowest in
more than 10 years on Monday, barely budged after the GDP data. 
However, the figures are likely to reinforce fears that global
activity will sharply contract in the first half of the year.
Singapore is one of the world's most open economies.
    The Australian dollar  AUD=D3  fell 1.3% to $0.5879, while
the New Zealand dollar  NZD=D3  declined by 1% to $0.5793.
    Both the Aussie and the kiwi collapsed to multi-year lows
earlier this month as nervous investors liquidated positions in
favour of holding their money in the greenback in cash deposits.

 (Reporting by Stanley White; Editing by Richard Pullin and Kim
Coghill)
 ((stanley.white@tr.com; +81 (0)3 4563 2799;
twitter.com/stanleywhite1 ;))

Warning: This content may be provided by regulated and unregulated entities and is not created, reviewed or endorsed by Davy. It is provided for general information purposes only and does not constitute a recommendation or solicitation to purchase or sell any security or make any other type of investment or investment decision. Importantly, it does not constitute investment advice, as it does not contemplate the personal circumstances of any particular person or group of persons. Neither Davy nor the providers of the Third Party Content will be liable for any investment decision made based on the reliance on or use of such data, or any liability that may arise due to delays or interruptions in the delivery of the Third Party Content for any reason.