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The dollar rises as fears about the Chinese virus subside; the euro falls

The dollar rises as fears about the Chinese virus subside; the euro falls


The dollar shows some strengthening this Friday against the Japanese yen, considered a safe haven, as traders recover a relative calm by leaving behind concerns about the impact of a new virus similar to pneumonia in China.

At 8:50 a.m. (CET), the dollar rises 0.1% against the yen, reaching USD / JPY to the level of 109.54. The dollar index futures , which follows the evolution of this currency with respect to a basket of six other major currencies, advances 0.1% to 97.53.

The number of cases of patients infected with the new virus until January 23 has risen to 830 in China, while the number of deaths from the virus has increased to 25, according to the National Health Commission on Friday.

The World Health Organization decided on Thursday not to qualify the global health emergency virus, even though the number of cases of patients infected with the new virus has already exceeded 800 in China, and the death toll has risen to 25.

“Make no mistake, it is an emergency in China, but it has not yet become a global health emergency,” said Tedros Adhanom Ghebreyesus, director general of the WHO, at an informational meeting on Thursday in Geneva.

On the other hand, the euro has been greatly weakened after the European Central Bank indicated that it would not change its current monetary policy stance at the meeting on Thursday.

“The ECB will continue to closely monitor inflation, a very accommodative monetary policy is still needed and the ECB is willing to use all the instruments. In other words, monetary relaxation remains on the table,” said Nordea analysts (ST : NDASE ), in a research note.

The remarks of President Christine Lagarde do not imply that they now have more reservations when using any of the tools available to the ECB, says the note. “If the downside growth risks increase again in the coming months, as we believe will happen, the market should have no problem fixing prices assuming a greater risk of new stimulus measures.”

With this in mind, “the euro will not be supported by the ECB’s monetary policy in the near future.”

At 8:50 a.m. (CET), the EUR / USD pair drops 0.1% to the level of 1.1048 and the EUR / GBP leaves 0.1% to 0.8417.

As growth forecasts are very important in the eyes of the ECB, traders will focus on the different PMI data published this Friday, and in particular on the PMI reading of the German manufacturing sector.

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