Here are the latest market charts and analysis for today. Check them out and know what’s happening in the market today.
The pair has gained further momentum to the upside in recent trading sessions, going farther above the 50-day moving average and effectively reversing the downtrend seen by the end of last year. According to market experts, the Russian ruble, along with other emerging market currencies, are being hurt by the risk-off sentiment among investors due to the spread of concerns about the Wuhan coronavirus. The death toll has reportedly increased to more than 80, while confirmed cases rose sharply to more than 2,700. Around 40 million people are in lockdown. Apart from the Russian ruble, the Russian stock market has also suffered because of the virus. There have also been sharp falls in various commodities, reflecting the increasing worried market over the adverse implications of the coronavirus, not only for China but also for worldwide economy. Oil prices have plunged to the lowest level so far this year.
The pair is still trading near the lower bounds of the daily chart, with the Swiss franc still undeniably strong even through the dollar is getting a booster shot from the fears of a wider coronavirus pandemic. The dollar and the franc are both safe haven currencies, but their moves were limited as the world watches health authorities try to prevent a global-level outbreak. The Swiss National Bank, however, appeared to remain on the sidelines as the CHF surged to it highest level in almost three years, thanks to the coronavirus boost. This is indicative that the SNB, which declined to issue a comment, will likely tolerate a slightly stronger franc after the US Treasury added Switzerland on a list of potential currency manipulators this month. In general, the negative interest rate and currency interventions are the main tools the SNB uses to put a cap on the franc, whose strength damages the country’s export-dependent economy.
Unlike against other currencies, the dollar actually weakened against the Czech koruna, trading in the red and pulling back toward the 50-day moving average, which is serving as a key resistance line for the pair. Over in Czechia, a business journal claimed that the US has threatened Czechia with tariffs on the country’s products if the Czech parliament gives the go ahead of a 7% digital tax, which is to be debated next week. On the other hand, Czech Finance Minister Alena Schillerova played down fears of US sanctions, saying that she doesn’t fear retaliation. The digital tax would affect companies that have a global turnover of more than 750 million euros. At least four million euros is generated in Czechia. In effect, the tax law would prevent US companies like Google, Amazon, Facebook, and Apple from avoiding taxes by shifting profits through third-world countries. Officials say that the tax could generate 198 million euros in revenue annually.
The pair slightly inched up after trading at its lowest, although the Swiss franc is still at its strongest level in many months against the euro due to a plethora of factors. Apart from the weakness of the euro, the Swiss franc is also strengthening because of the of the SNB’s hands-off policy on the Swiss franc after being added as a potential currency manipulator by the US Treasury Department this month. Meanwhile, the euro managed to move up despite the defeat of the Eurosceptic League party in Italy in a crucial regional election in Emilia-Romagna. The Democratic Party-led centre-left bloc came out victorious, easing pressure on the government of Prime Minister Giuseppe Monte. The victory also reduced the likelihood of a snap election. League leader Matteo Salvini has attempted to unseat Monte and appeared to be gaining support anew. However, the gains in the euro may be short-lived after last week’s dovish ECB guidance.