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There’s a strange calmness in the air – you feel it? No anxiety from industry, no panic to get anywhere, no time constraints, just a lockdown journey of human unification. Time stands still almost, perhaps a moment to smell the flowers, a time for reflection?
Day six of the official New Zealand lockdown.
It’s been another massive week in currencies/global markets with central bankers struggling to come to terms with coronavirus headlines and weak economic data.
US Dollar weakness Thursday continued into the weekly close, underperforming against the basket of majors, the index falling 4.5%. This marks one of the worst performing week’s since the 2008 GFC reversing the previous week’s 4.12% gain. The kiwi is nearly 6% higher, Aussie 6.12% and British Pound 6.93% on the week. The Fed announced an unlimited “QE” program as congress passed a USD $2Trillion bailout package, the biggest they have ever announced. With the virus spiralling out of control in the US – especially in NY where numbers have reached apocalyptic levels around 60,000 and the total number of deaths just over 1,000.
The only local data this week is today’s ANZ Business Confidence which is expected to survey poor- the NZD could take a hit post release. The 4 week lockdown in New Zealand is expected to cause June 2020 GDP to fall by around 14% with unemployment rising to 9.0%. But…the recovery won’t be as long winded as other past recessions and 2008 GFC based on current measures in place by the Govt and RBNZ to cushion business and personal financial cost.
Markets opened Monday a lot more relaxed than the previous two weeks due to the safety of lockdown measures and financial measures in place. Movement into Tuesday has not been as wild as the previous two weekly starts- currencies almost look organised.
• New Zealand has added 58 to the infected today with our total infected cases now 647
• I’m struggling to work out why the world’s 2nd and 4th biggest countries by population – India and Indonesia only have around 1,600 cases of Covis-19, surely these numbers are inaccurate, the numbers being tested must be very low.
• PM Ardern says the NZ borders will probably remain closed until either the virus reaches herd immunity through an inability to be controlled or a vaccine is available. Hopefully it’s the latter.
• Crude Oil has been bearish for a few week’s now after Saudi Arabia started a price war and ramped up production, its trading at a 17 year low just off $20.00 a barrel.
• USA now tops the Covid-19 table with 162,835 infected cases and 3,128 deaths
• The US coronavirus Bill was passed yesterday as the US economy stares down one of the worst economic downturns in its history. The 2.2Trillion relief bill aimed at reducing the financial carnage caused by the Covid-19 pandemic
Major Announcements last week:
- World coronavirus cases 784,381
- Currency markets comparitively calmer this week