Weekly Market Update 9 Apr – Fall in Treasury yields and increase in unemployment claims does not dampen US rate of economic recovery
Weekly Market Update 9 Apr – Fall in Treasury yields and increase in unemployment claims does not dampen US rate of economic recovery
1. USD, in tandem with US Treasury yields, retreated further this week. The initial jobless claims turned out worse than expected and the Fed’s minutes released on Wednesday were dovish – reiterating that US central bank would seek to keep financial conditions as lenient as possible for quite some time. However, with the upside momentum in the American economy overall, it is in a much better position to benefit from the recovery than its peers.
2. Economic data showed industrial production in Germany and France contracted sharply in February, missing market forecasts. With uncertainty around rising infection rates and sluggish rollout of vaccines, it is unlikely that restrictions will ease anytime soon.
3. The slowdown in COVID vaccinations in the UK are making investors cautious, as this may delay the government’s plans to reopen the economy. This is despite UK PM Boris Johnson’s announcement of a new mass testing programme that aims to help health officials track the pandemic. Regardless, as UK’s vaccine rollout is relatively smoother than its peers in the region, investors are still confident that the Britain’s economy would reopen soon.
