On Wednesday Asian shares fell as a U.S. warning to Americans to prepare for the possibility of a corona-virus pandemic drove another Wall Street tumble and pushed yields on safe-haven Treasuries to record lows.
China’s corona-virus is presently spreading faster in the Europe as Spain, Croatia and Switzerland are the latest ones to join the league of infected nations. The latest figures from Italy and South Korea also keep the fears of a widespread outbreak.
The United States 10-Year yield fell to record low of 1.307% in the wake of growing worries the potential impact on global growth from Covid-19 will be worse than expected, forcing the Fed to act in April, June and July.
The U.S. dollar fell on Tuesday, following a plunge in Treasury yields, as weaker U.S. consumer confidence raised questions about the strength of the economy at a time when traders are betting the rapid spread of Covid-19 may trigger a material change to the Fed's outlook on economy, forcing a flurry of rate cuts.
The People's Bank of China (PBOC) has set the Yuan reference rate at 7.0126 versus Tuesday's fix at 7.0232.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.37% to 98.92. USD/JPY fell 0.64% to $110.04 and USD/CHF fell 0.31% to 0.9757. GBP/USD rose 0.60% to $1.3005 and EUR/USD rose 0.26% to $1.0882. USD/CAD fell 0.15% to C$1.3272 even as the loonie was pressured by a slump in oil prices amid concerns about the virus' impact on Chinese oil demand growth.
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