Earlier in the Day:
It was a relatively quiet day on the Asian economic calendar this morning. Economic data was limited to 4th quarter GDP numbers out of Japan.
Updates from China and the rest of the world on COVID-19 cases and the number of deaths also influenced early in the day.
According to the latest numbers, the total number of deaths in China rose to 1,770, up by 105 from Saturday. Across China, there were 2,048 new confirmed infections, taking the total to 70,548.
Later today, finalized industrial production figures out of Japan will likely have a muted impact on the Yen.
For the Japanese Yen
The Japanese economy shrunk by 1.6% in the 4th quarter, compared with the 3rd quarter, following 0.4% growth in the 3rd. Economists had forecast a 0.9% contraction.
Year-on-year, the economy contracted by 6.3%, which was far worse than a forecasted 3.7% contraction. In the 3rd quarter, the economy had grown by 1.8%.
The worst economic numbers since a 7.1% slump in the 2nd quarter of 2014 came as Japan got hit by typhoons, the U.S – China trade war and the sales tax hike.
The Japanese Yen moved from ¥109.821 to ¥109.759 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.05% to ¥109.83 against the U.S Dollar.
The Day Ahead:
For the EUR
It’s a quiet day ahead on the economic calendar.
There are no material stats due out of the Eurozone to provide the EUR with direction.
Through the early part of the day, the EUR found some relief as COVID-19 numbers out of China showed the pace of infection slow.
We can expect the EUR to remain under pressure, however, as concerns over the economic outlook linger.
At the time of writing, the EUR was up by 0.06% at $1.0837.
For the Pound
It’s a particularly quiet day ahead on the economic calendar, with no material stats due out of the UK to provide direction.
Following last week’s rebound to $1.30 levels coming off the back of hopes that the government will loosen the purse strings, the focus will likely return to trade.
Spending is just one piece of the jigsaw for the Pound, with a free trade agreement between the UK and the EU a must as far as the markets are concerned.
Expect any chatter from the EU to influence, with the French continuing to send hostile messages across La Manche.
Later today, Britain’s chief negotiator, David Frost is scheduled to speak and will likely look to change the tone following the threats from France.
At the time of writing, the Pound was down by 0.02% to $1.3045.
Across the Pond
There are no material stats due out of the U.S, with the U.S markets closed today.
While there are no stats, any chatter from the Hill could catch the markets off-guard…
At the time of writing, the Dollar Spot Index was flat at 99.122.
For the Loonie
It’s a quiet start to the week on the economic calendar, with Canada also on holiday today.
A lack of stats and lighter volumes will leave the Loonie in the hands of market risk sentiment.
COVID-19 numbers out of China this morning provided early support.
The Loonie was up by 0.07% at C$1.3243 against the U.S Dollar, at the time of writing.
This article was originally posted on FX Empire
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