Check out our daily recap of the latest Forex and market news around the globe for Wednesday, March 25, 2020 here.
– The global coronavirus pandemic continues to increase exponentially from its epicenter in Europe and the U.S.A, with more and more countries imposing severe restrictions which are causing very significant economic damage. A global recession appears to be inevitable, with Goldman Sachs forecasting a 23% drop in U.S. GDP.
– The rate of increase in fatalities and new confirmed cases continues to grow in the epicenter with the exception of Italy, which has begun to see a slowdown in the rate of new confirmed cases, providing some hope that the lockdown is beginning to show results. Confirmed cases in the U.S.A. now put it 3rd behind only China and Italy, with over 25,000 cases now in New York City alone.
– World stock markets, especially in the U.S.A., bounced back very strongly yesterday on confirmation of the passage of a $2 trillion rescue package by the U.S. Congress.
– The Dow Jones Industrial Average made its strongest daily rise since 1933. The long-term trend in stocks is bearish, but there is a chance we may have seen the bottom of this bear market in stocks.
– The Australian and Canadian Dollars have the most short-term strength today of all currencies, while the Japanese Yen is the weakest currency. We might be seeing the start of a trend change, or just a short-term pull-back in the dominant long-term trends.
– The Australian Dollar, the British Pound, WTI Crude Oil and Silver all hit multi-year lows last week.
– Markets are affected by very high volatility, and plummeting consumer demand. This provides opportunities for traders, but close monitoring of trades on short time frames is very advisable due to the strength and speed of price movements.
– The key factor in markets today will likely be how the U.S. Treasury and Administration continue to tackle the crisis, with tension building over those such as President Trump who seem more concerned with the potential damage from the economic shutdown than with the immediate damage from the pandemic.