Pandemic Curve Matches Pandemonium Curve
This week, in reflection of improved risk sentiment the US dollar broadly underperformed. To a large extent, this has been driven by the flattening curve of the Covid-19 pandemic,
The pound recovered to around $1.24, helped also by reports that PM Johnson’s condition in an intensive care unit is improving. The euro pared gains, however, and peripheral spreads remained wide as Eurozone finance ministers initially failed to agree on an EU safety net to address the economic impact of the coronavirus.
Brent crude oil was around $33 a barrel, maintaining gains on expectations of an output cut among major producers.
The number of global Covid-19 cases topped 1.5 million, but there appears to be cautious optimism among investors that the curve is being flattened, with new infections rising at a slower pace. In turn, that has raised hopes that we may be closer to the reopening of major economies. In China, restrictions have already been eased in the city of Wuhan where the pandemic began. Still, renewed rises in coronavirus cases during the week, for instance in Italy and Spain, point to caution, while fatalities are rising more quickly in several countries. Hence, restrictions put in place to contain the virus look likely to be extended.
See you next week!
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