The dollar posted weekly gains due to fears of spreading waves from the Covid-19 pandemic. The total number of cases in Germany increased by 913 to 173,152 on Thursday and Friday. While the number of dead rose 101 to 7,824 after the country made lockdown relaxation. New cases have also been noted in various countries which loosened lockdown rules, dashing optimism about the recovery of the global economy. To get more news about WikiFX, you can visit wikifx news official website.
With the waning hopes of a global economy recovering quickly, market participants are again after safe haven assets, such as the US dollar. Safe-haven demand increased after renewed tensions between the US and China. President Trump stated that he was reluctant to dialogue with President XI Jinping and said that his party could have cut off relations with China. The pound fell 0.6% last Friday to $ 1.2155, the lowest since March 27, after European Union Brexit negotiator Michel Barnier said on Friday that the third round of talks with Britain was "disappointing". While the euro also fell after data showing the German economy contracted 2.2% in the 1-2020 quarter. At present the German economy has entered a recession from the 2009 financial crisis.
Spot gold prices touched a 7.5-year high last Friday, while US gold futures rose to a one-month high after disappointing US data. Last Friday's data showed retail sales fell 16.4%, while industrial output fell 11.4%, marking the worst monthly performance for both data because the Covid-19 pandemic nearly paralyzed the US economy. . The price of gold has soared following the escalation of new US-China tensions. Although overshadowed by concerns about renewed tensions between the US and China, oil prices managed to strengthen last week. Sentiment that drives oil prices includes efforts to cut output by oil producing countries. Saudi Arabia said Monday it would cut more production by 1 million bpd in June. Meanwhile, although US President Donald Trump is outraged against China, this can be masked by Chinese data, which led WTI to rise to the $ 30 per barrel area. Data last Friday showed China's industrial output rose 3.9% in April, recovering after falling 1.1% in March.
Oil prices also rose after the number of rigs in the US declined, as well as EIA data that showed US oil reserves fell for the first time in 15 weeks by 745 thousand barrels. On Friday the price of WTI oil rose 6.8% to $ 29.43 a barrel, while Brent rose 4.4% to $ 32.50. During the week WTI rose 19%, while Brent rose 5%. US stock index futures gained amid mixed sentiment after the reopening of the economy around the world was offset by warnings that economic recovery will take a long time. The S&P 500 index rose 0.6%. Meanwhile, Asian stock index futures moved varied. In Asia, the Hong Kong futures index fell, but shares in Japan and Australia strengthened. Focus This Week: Powell, Bailey, Lowe & PMI Data There are three central bank officials who will deliver speeches this week, they are the chairman of the Fed, Jerome Powell, BoE Governor Andrew Bailey, and RBA Governor Phillip Lowe. Another market focus is PMI data services and manufacturing services in the UK and US. Other data that is worth looking at is the US Jobless Claims and the Philly Fed Manufacturing Index. Meanwhile, the Fed will also release its minutes.