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Protected: An Update :US Dollar Index ,USDJPY ,AUDUSD ,USDINR ,EURO ,YEN ,GOLD ,SILVER ,PALLADIUM ,WTI ,BRENT ,SPX 500 -Anirudh Sethi

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The dollar rallied strongly from March 9 through March 20 or the start of last week on March 23.  It has subsequently sold off and done so in dramatic fashion.  It is not clear the trigger of the stunning reversal.  Some observers attribute it to the Fed’s currency swap lines, which were offered daily (seven-day operations) to a handful of large central banks.
Others link it to the better risk appetites reflected in meaningful bounces in equity markets, but nothing as striking as the 17% rally in the Nikkei.  Even with a 915-point tumble in the Dow and a 3.3% drop in the S&P 500 before the weekend, both ended with double-digit gains on the week.  Gold’s 8.6% rally will not sit well with those who view it as a safe haven.  The 30- and 60-day rolling correlations on the percent change of gold and the S&P 500 are positive for the first time since the middle of last year and October 2018, respectively.
The technical indicators that we monitor, the MACD and Slow Stochastic, have turned down for the dollar against all the major currencies.  The poor technical condition suggests the dollar’s weakness is more than a function of month- and quarter- and fiscal year-end flows, but was technically over-extended.  We will use Fibonacci retracement and moving averages to identify potential price targets and relative strength.
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Trump drops idea of New York lockdown as U.S. death count crosses 2,000

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President Donald Trump said on Saturday that he would issue a travel warning for the hard-hit New York area to limit the spread of the coronavirus, backing off from an earlier suggestion that he might try to cut off the region entirely.

“A quarantine will not be necessary,” he said on Twitter.

Trump’s announcement came as the U.S. death count crossed 2,100, more than double the level from two days ago. The United States has now recorded more than 122,000 cases of the respiratory virus, the most of any country in the world.

Since the virus first appeared in the United States in late January, Trump has vacillated between playing down the risks of infection and urging Americans to take steps to slow its spread.

Trump said on Saturday afternoon that he might impose a ban on travel in and out of New York and parts of New Jersey and Connecticut, the U.S. epicenter of the disease, to protect other states that have yet to bear the brunt. He offered few specifics.

Critics promptly called the idea unworkable, saying it would cause chaos in a region that serves as the economic engine of the eastern United States, accounting for 10 percent of the population and 12 percent of GDP. Continue reading »

Coronavirus – Japan’s PM Abe on Saturday promises unprecedented economic stimulus

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Abe said measures will include fiscal and monetary stimulus alongside tax breaks for companies

  • details have not been finalized
  • package will be rolled out in an extra budget in 10 days
  • size of the package will be greater than that compiled in response to the global financial crisis (total 57 trillion yen) said Abe
Abe spoke during a nationally televised news conference
  • “I want to be straightforward”
  • “We are in a critical stage. We need to be ready for a long-term battle”
  • “The pandemic is inflicting extremely big damage to Japan’s economy”
  • “We’ll deploy a huge, powerful package that will include a full range of fiscal, monetary and tax measures.”
Abe said measures will include fiscal and monetary stimulus alongside tax breaks for companies

North Korea appears to have fired another missile – has not landed in Japan’s EEZ

On By In Analysis, Politics

The Japanese Coast Guard says the unidentified projectile appears not to have land inside Japan’s economic zone.

  • missile has landed in the East Sea
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“EEZ” is exclusive economic zone
a sea zone prescribed by the 1982 United Nations Convention on the Law of the Sea
Japans EEZ is in debate, but its approx. the area in the darker blue area in the map below
The Japanese Coast Guard says the unidentified projectile appears not to have land inside Japan's economic zone.

FT: Global petrol demand set to drop as much as 50% in some key markets

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Financial Times piece citing analysis

Global petrol demand set to drop as much as 50 per cent in some key markets
Oil refineries worldwide are preparing to slash processing rates
petrol becomes the next part of the oil market to become distressed
“It’s like the entirety of Europe, Africa and the Middle East combined stopped driving,” said Cuneyt Kazokoglu, FGE’s head of oil demand, about the drop in petrol usage in the US.
Here is the link, worth a read if you can access the (often gated) FT

OPEC presidency urged an emergency meeting on collapsing prices, members said no.

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Algeria currently holds OPEC’s rotating presidency, urged convening a panel to consider assesses market conditions and falling prices.

Bloomberg cite an unnamed official as saying the request did not get enough backing to go ahead.
  • Key player Saudi Arabia said to be opposed.
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Algeria asked OPEC’s secretariat to convene a teleconference meeting of the Economic Commission Board.
Algeria currently holds OPEC's rotating presidency, urged convening a panel to consider assesses market conditions and falling prices.