Private Sector PMIs and the Coronavirus in Focus as Risk Aversion Hits

Earlier in the Day:

It was a relatively busy day on the Asian economic calendar this morning. The Japanese Yen was in action, with January inflation figures and prelim February private sector PMIs in focus.

Outside of the numbers, risk aversion plagued as the markets responded to news updates on the spread of the coronavirus.

For the Japanese Yen

The annual rate of core inflation picked up from 0.7% to 0.8% in January, while the annual rate of inflation eased from 0.8% to 0.7%. The numbers were in line with forecasts. Consumer prices stalled in January, following a 0.1% rise in December.

The Japanese Yen moved from ¥112.048 to ¥112.030 upon release of the figures that preceded the PMIs.

In February, the Manufacturing PMI fell from 48.8 to 47.6, with the Services PMI falling from 51.0 to 47.6, according to prelim numbers.

The Japanese Yen moved from ¥112.118 to ¥112.0132 upon release of the figures. At the time of writing, the Japanese Yen was up by 0.13% to ¥111.95 against the U.S Dollar.

Elsewhere

At the time of writing, the Kiwi Dollar was down by 0.41% to $0.6307, with the Aussie Dollar down by 0.29% to $0.6596.

The Day Ahead: 

For the EUR

It’s a busy day ahead on the economic calendar. Key stats include France, Germany and the Eurozone’s prelim private sector PMIs for February.

Finalized January inflation figures from Italy and the Eurozone are also due out but will likely have a muted impact on the EUR.

Forecasts are EUR negative and we can expect plenty of sensitivity to the numbers. The PMIs will give the markets an indication of just how bad things are likely to get on the economic front.

From the U.S, private sectors PMIs are also due out and will also influence risk sentiment later in the day.

At the time of writing, the EUR was up by 0.07% at $1.0793.

For the Pound

It’s another relatively busy day ahead on the economic calendar. Key stats include prelim private sector PMI numbers for February.

We saw January’s private sector activity give the BoE reason to pause in the last MPC meeting. Expect any dire numbers to raise expectations of BoE support near-term. The market focus will be on the services PMI…

Outside of the numbers, there is always Brexit chatter to also impact.

At the time of writing, the Pound was up by 0.09% to $1.2893.

Across the Pond

It’s a relatively busy day ahead on the U.S economic calendar. Key stats include February’s prelim private sector PMIs and January existing home sales figures.

Expect the PMI numbers to have the greatest impact on the Dollar and risk appetite.

While the focus will be on service sector PMI numbers, the manufacturing PMI will need to hold its ground.

The markets are expecting a resilient U.S economy amidst the spread of the coronavirus.

At the time of writing, the Dollar Spot Index was down by 0.06% to 99.6803.

For the Loonie

It’s a relatively busy day ahead on the economic calendar, with December retail figures due out of Canada.

With the BoC sitting on the fence digesting economic data, expect the Loonie to be particularly responsive to the numbers.

Any slide in spending and we can expect the BoC to begin leaning towards providing further support.

The Loonie was up by 0.07% at C$1.3250 against the U.S Dollar, at the time of writing.