Foreign Exchange - Euro Rises - Sterling Falls

Foreign Exchange - Euro Rises - Sterling Falls

With the central bank evaluations pointing to coordinated actions to stabilize the panic market caused by coronavirus, the emerging market currencies grew greatly, while the euro saw the highest in one month against the dollar. The Bank of Japan (BoJ) followed the US Fed with its promises. The Bank promised to take action when needed to support the market “in the face of increasing uncertainties regarding the economic activity outlook due to the coronavirus outbreak”. "It will work to provide abundant liquidity and ensure stability in financial markets through appropriate market operations and asset purchases," said BoJ. On Friday, the Fed stopped panic sales in the market, saying it would "act appropriately to support the economy". Although the language of the statement is not different from the previous policy assessment, it was seen as a guarantee that central banks would not allow the market to progress to recession in a panic. Powell, "The foundation of the US economy is still strong," he said. The Bank of England (BoE) said on Monday it will take all necessary steps to maintain financial stability. Prior to that, French Bank (BoF) Manager Francois Villeroy de Galhau told BFM TV that the European Central Bank (ECB) was ready to do "more" when necessary, but thought that the moment was not yet arrived. IHS Markit's February purchasing managers indices (PMIs) and other data can take this discussion further. According to data from Saturday, official Chinese PMI data saw its worst level ever, while the Caixin PMI, which also includes the private sector, remained below expectations, reaching 40.1 points. The People's Bank of China (PBoC) said that banks should recognize SME loans, which is an important support for the private sector, as a performance factor by June. While the euro increased by 0.4% to $ 1.1079, the dollar index fell by 0.2% to 97.91. On the other hand, Boris Johnson threatened to withdraw from talks if the EU insisted on the role of the European Court of Justice in managing the free trade agreement negotiated by the two sides, and the pound continued to weaken under the pressure of these evaluations. Against the dollar, it fell by 0.1% to 1.2794 and decreased by 0.9% against the euro to 1.1531.