The Japanese yen scaled a three-year high against the euro and a seven-week peak on the dollar after a court decision challenged Germany’s participation in ECB’s stimulus program. The news sent the euro to a one-week low of $1.0826 overnight and it slumped to a three-year trough of 115.09 yen in Asia, as traders fretted about the scheme. The Australian and the New Zealand dollar slipped slightly on the greenback, though held above their respective resistances of 64 cents and 60 cents. The Aussie last sat at $0.6437 and the New Zealand dollar at $0.6058. The pound was steady at $1.2431 as the UK overtook Italy for Covid-19 fatalities. Spot gold is on its third day of rise trading at $1,707 an ounce.
Chinese markets opened for the first time since last Thursday with CN50 close to reaching end-of-April levels of above 13434. Australian shares shed 0.8% while Hang Seng added 0.7%. On Wall Street, the S&P 500 pared earlier gains after FED Vice Chair Richard Clarida warned that economic data would get much worse before getting better. The index finished 0.90% higher. Meanwhile, the Dow rose 0.6% and the tech-oriented Nasdaq added 1.1%.
U.K.’s coronavirus death toll soared passed that of Italy, making it the worst hit country in Europe. Italy reported its fourth straight decline in new cases as the lockdown started to ease but deaths in France rose at the fastest pace in six days. France also discovered an undiagnosed Covid-19 patient from last year. Hong Kong moved to ease restrictions and the state of Bavaria set out plans to reopen its economy in what may serve as a trial for the rest of Germany. Chancellor Merkel meets today the state premiers to discuss a gradual reopening of the country. Meanwhile, the US is considering disbanding its virus task force as President Trump also moves to reopen the economy although the number of infections there continues to rise.
Australia will have a COVID-19 safe economy up and running by July, Prime Minister Scott Morrison said as his government seeks to get one million unemployed people back to work. Australia is expected to announce on Friday a loosening of social distancing restrictions with curbs on most businesses removed by July. Unemployment is expected to top 10% this year and the Reserve Bank of Australia expects GDP to slump 6% during 2020, a slump that could cost the country A$4 billion each week. The resumption of business might also coincide with the opening of the borders between Australia and New Zealand who are promoting themselves as safe havens after the success in curbing the coronavirus, allowing the countries to be open for investment.