Forex Today: Risk Appetite Slips as Global New Daily Coronavirus Cases Hit All-Time High

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The rate of new coronavirus infections appears to be increasing most quickly in Russia, Brazil, Mexico, Peru, and India.

  • Yesterday saw the highest number of new confirmed coronavirus cases globally since the pandemic began. Confirmed coronavirus deaths in Latin America are beginning to exceed the number reported in the U.S.A. which suggests that the epicenter of the pandemic can now be said to be in South America, especially Brazil which saw over 800 deaths and 20,000 new confirmed cases yesterday.
  • Total reported deaths globally peaked on April 18th while daily new confirmed cases continue to rise. Total confirmed new cases stand at more than 5 million with an average case fatality rate of 6.56%. Both the total number of new cases and deaths continues to slowly fall daily in the U.S.A. and in the U.K. although there is some evidence a rising trend of new cases is beginning in the U.S.A. A world recession or possibly even depression from the pandemic appears to be inevitable, with Goldman Sachs forecasting a 34% drop in U.S. Q2 annualized GDP and other analysts seeing a 30% unemployment rate in the near future. If correct, these will be the worst such numbers seen since the 1930s, but it should be noted many analysts continue to see a much better outlook for U.S. unemployment. The WTO has forecasted that global trade is set to fall by one third. The U.S. now sees an unemployment rate of 15% and a drop in 1st Q GDP of 4.8%.
  • Stock markets closed mostly up yesterday, but the Asian session saw a downwards pullback. The U.S. market indices remain firm, with the S&P 500 Index closing above its 61.8% Fibonacci peak-to-trough retracement yesterday, only 30 points from its 200-day moving average. Many market analysts think the bottom of this bear market has already been reached, but other analysts see further strong falls likely in stocks over the coming weeks and months. There is a strong divergence of opinion, but we are seeing the bullish case strengthen.
  • The British Pound is the weakest major currency, while the U.S. Dollar is the strongest today.
  • The price of crude oil continues to rise to trade above $34 per barrel.
  • The rate of new coronavirus infections appears to be increasing most quickly in Russia, Brazil, Mexico, Peru, and India. Russia now has the second highest number of confirmed cases, followed closely by Brazil and then the U.K. While a strong majority of confirmed coronavirus cases are still in Europe and the U.S.A., with the U.S.A. accounting for approximately 31% of all cases, infections are beginning to increase dramatically in Latin America, which is now accounting for more than one quarter of daily global deaths.

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