‘US states put brakes on reopenings as new Covid-19 cases hit record’. Texas, Florida, and California all reported record increases in new daily cases of the coronavirus, prompting US political and business leaders to put a halt to the gradual reopening. Apple decided to close its retail stores in Houston as officials believe the area could be emerging as a hotspot for infection. At the same time, Disney said it could push back the reopening of its California theme parks. Meanwhile, Fed member Charles Evans said that US growth will be hampered by recurring outbreaks, with unemployment levels set to stay elevated for some time to come. (Financial Times)
‘IMF slashes economic outlook and warns of public debt burden'. The global economic impact of the coronavirus will be worse than initially thought, with government debt set to soar as a result of recovery programmes. The biggest downgrade was for France, which is expected to contract 12.5 percent this year, but all advanced economies will bear the brunt of the damage. As a proportion of GDP, public borrowing is set to surpass the record level that it reached during the second world war. (Financial Times)
Stocks and risk currencies fell yesterday and overnight due to the rising cases of Covid-19 in the US and renewed fears that a resurgence will derail the global economic recovery. The S&P 500 finished 2.6% lower, while UK and EU equity markets also fell. The Japanese Yen, gold, and US treasuries all rose.
German Gfk Consumer Climate: -9.6 vs -18.6 previously
ECB monetary policy meeting accounts: 12.30pm
US Durable/Core Durable Goods Orders: 1.30pm
US final GDP Q1: 1.30pm
US Weekly Jobless Claims: 1.30pm