Opening up America again

Today’s news headlines:

  • ‘China suffers historic economic slump with hard recovery ahead’ – China was pushed into its first contractionary quarter in decades following the coronavirus outbreak. Q1 GDP shrank 6.8% from a year ago – worse than the forecasted 6%. A recovery may already be under way as some sectors of the economy are already up and running, but China will face weak demand from the rest of the world for many months. (Bloomberg)

  • ‘Trump’s guidelines may have some states reopening in a month’ – President Trump announced guidelines on reopening the US economy, stating employers could curb social distancing measures within four weeks, with some states able to start the process tomorrow. Trump has been pressing to reopen the US economy as fast as possible, despite the numbers of cases and deaths rising rapidly. (Bloomberg)
     

Today's events, rates, and data 

  • Steps to re-open the US economy boosted demand for global equities, despite China posting its first contractionary quarter in decades and the US recording 5 million more people unemployed. Treasury yields bounced and the US Dollar weakened against most major currencies.

Today's events

China missed expectations overnight, posting GDP growth of -6.8% year on year while Industrial Production beat the forecast, posting a milder contraction. This morning, year on year Eurozone CPI is expected to fall well below target, at 0.7%.

Interbank rates:

GBPUSD: 1.2465

GBPEUR: 1.1500

EURUSD: 1.0840