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FOREX: Dollar firms as virus worries return

News Service
09:34 - 8/04/2020 Çarşamba
Update: 09:36 - 8/04/2020 Çarşamba
REUTERS
File photo: George Washington and Queen Elizabeth II are seen with printed medical masks on the one Dollar and Pound banknotes in this illustration taken, March 31, 2020
File photo: George Washington and Queen Elizabeth II are seen with printed medical masks on the one Dollar and Pound banknotes in this illustration taken, March 31, 2020

WATCHING WUHAN

A Reuters tally shows 81,451 coronavirus-related deaths globally and nearly 1.4 million infections. British Prime Minister Boris Johnson, who is infected, remains in intensive care although his condition is stable.

Meanwhile, there are signs of a levelling off of hospitalisations in New York, and in Europe there are plans to begin easing some of the lockdowns as fatalities have been declining.

The Chinese city where the coronavirus epidemic first broke out, Wuhan, ended a two-month lockdown on Wednesday, although a northern town started restricting the movement of its residents amid concerns of a second wave of infections.

"What we see and hear from Wuhan will be quite important for whether any improvement in sentiment can be maintained," said Ray Attrill, head of FX strategy at National Australia Bank.

"There is very keen interest in how willing Wuhan residents are to get out and about, and hope there won't be evidence of re-infections any time soon."

Mainland China's new coronavirus cases have doubled in 24 hours and new asymptomatic infections more than quadrupled, while the economic cost of the pandemic becomes clearer.

Ratings agency S&P Global on Wednesday warned the cost of combating the virus would weigh heavily on Australia's finances and changed the outlook for the country's rating to negative.

Against a basket of currencies the dollar edged up 0.2% to 100.170 and it rose 0.3% against the Chinese yuan.

"While the virus' curve is flattening, the economic effects of the corona crisis will linger for years," said Commonwealth Bank of Australia currency analyst Joe Capurso.

"Economies will take time to re-open, some businesses will not re-open, and unemployment will take years to (recover). We think that means the dollar and yen will re-strengthen."

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