Dollar Up in The Aftermath of Bad Economic NewsMay 7, 2020
The dollar was up on Thursday morning in Asia with investor risk appetite soured by an onslaught of bad economic news.
The US Dollar Index that tracks the greenback against a basket of other currencies gained 0.05% to 100.185, as investors looked to the dollar as a safe haven.
The U.S. said overnight that private employers laid off a record 20.2 million workers in April, and analyst forecasts prepared by sources predict another 3 million Americans claimed unemployment benefits over the past week.
The USD/JPY pair was up 0.05% to 106.19 as Japanese markets reopened after a holiday.
“The yen is gaining as there are some questions over the European Central Bank’s stimulus and as tensions between the United States and China increase again,” said sources.
Germany’s highest court earlier in the week gave the European Central Bank three months to justify the purchases under its bond-buying program or lose Bundesbank participation in one of ECB’s main stimulus schemes.
The AUD/USD pair lost 0.31% to 0.6420. The NZD/USD pair gained 0.21% to 0.6019.
The USD/CNY pair lost 0.09% to 7.0969 after U.S. Secretary of State Mike Pompeo renewed accusations that the COVID-19 virus originated in a Wuhan lab overnight, despite admitting that there was no certainty in the claim.
U.S. President Donald Trump added that he would be closely watching to see whether China was fulfilling its obligations under a Phase 1 trade signed between the two countries in January.
The GBP/USD pair slid 0.14% to 1.2323, touching its lowest level in two weeks even after Prime Minister Boris Johnson said overnight that the country’s lockdown measures could be loosened by next week.