The Dollar remains strong because of the increase of cases of Covid-19

By Peter Nurse

The dollar has maintained its tone strong in the european session on Friday, traders seeking to shelter while the number of cases of coronavirus in the United States continues to increase.

At 10: 45, the dollar index, which tracks the greenback against a basket of six other currencies, rose 0.1% to 97,420.

EUR/USD fell 0.1% to 1,1211, GBP/USD fell 0.1% to 1,2408, while USD/JPY has declined 0.1% to 107,13.

“With data likely to play second fiddle in the face of headlines about the virus, the investors should remain quite nervous today, with the balance of the risks to the assets pro-cyclical leaning downward and the dollar could remain supported on the bids for safe-haven assets,” said analysts at ING (AS:INGA), in a research note.

The economic data have pointed to an economic recovery in the United States on Thursday, with another small decline of unemployment claims and a substantial increase in durable goods orders. Friday provides data on expenditure and that the figures on the feeling of Michigan.

However, this was overshadowed by the announcement of a record number of new cases of coronavirus in the United States as a whole, the health ministries of the Member who has reported a total of more than 37 000 new cases Thursday.

“There are fears that new restrictive measures can be deployed. In return, if we maintain a positive view in the medium term on risk assets, especially the figures of infection at Covid-19 which will influence sentiment in the short term,” added ING.

The second wave of sars coronavirus does not seem to be a story solely american. The development of the emerging countries and in the process of development continues to be problematic for their recovery, and especially for tourism.

“It is difficult to see things improve as we will not have a vaccine, which until now is still on track to arrive in 6 to 9 months”, said the analysts of the Danske Bank, in a research note.

Still in the sphere of emerging markets, the first round of the presidential election should take place in Poland on Sunday.

The outgoing president Andrezej Duda, the government party, is the favorite, but if he does not get the majority, there will be a second round in two weeks time, probably against the main opposition candidate, Rafal Trzaskowski, the program’s civic party, a reformist pro-market.

“If Trzaskowski surprises and wins, this could be positive for sentiment towards the asset Polish, including the PLN,” said Danske Bank.

USD/PLN has increased by 0.1% to 3,9712 and EUR/PLN by 0.1% to 4,4520.

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