Now, ugly macroeconomic data is a cruel debunk will be coronavirus cruelty of outbreaks, the United States over the past month break through 20 million, the total number of jobless claims at a time when the President of the United States announced a trump in stages to restart economic activity, the message to stimulate risk sentiment quickly picks up, the market volatility: U.S. stock futures rose by more than 3%, the gold price once fell close to 1700, the dollar index fell 100 mark, oil prices rose by more than 2%. This trading day (April 17), the market also needs to focus on China’s first quarter GDP data, may trigger a new wave of activity.
Trump announces big decision: restart the economy in stages
As of 08:52 Beijing time on April 17, there were more than 677,570 confirmed COVID 19 cases and 34,617 deaths in the United States, according to real-time data update website worldometers.
Businesses across the country have been forced to shut down to prevent the outbreak from spreading, dealing a blow to the U.S. economy. The debate over restarting the us economy is intensifying as more data show that a new pandemic is weighing on the world’s largest economy.
US President Donald trump announced a major decision on April 16, announcing guidelines to allow the us economy to reopen.
Mr Trump said the us death toll was expected to be lower than the previous administration’s “best case” estimate, given the effectiveness of a series of pandemic preparedness efforts.
He said the us had passed the peak of COVID 19 and would take a phased, gradual approach to reopening the economy. Mr Trump said americans in good health could return to work if conditions allowed.
Mr Trump has reportedly set out guidelines for states to restart their economies in three stages, set out testing standards that states must meet, and require rapid provision of protective gear to reopen. The governors of each state can carry out the guidelines according to the conditions of their own state, rather than relying on the orders of the federal government.
The plan as a whole will be carried out by region and phase. In areas where the situation is good and detection resources are adequate, economic and social restarts will be phased in over three phases, each of which is expected to last 14 days to prevent the outbreak from worsening. But those at high risk of infection are still advised to stay indoors.
Citing a White House economic guideline that trump is about to announce, the report proposes three phases for the reopening of events: In the first phase, large venues such as restaurants, theaters, and exercise rooms will be allowed to reopen, but strict social distance guidelines will be enforced, and schools and bars will remain closed. In addition, it is required to avoid holding gatherings of more than 10 people and unnecessary going out. The second phase applies to states and regions where there is no sign of a rebound. The guidelines recommend that schools and youth camps reopen, bars may reopen after reducing standing space, restrictions on unnecessary travel will be lifted, but people are still advised not to participate in activities involving more than 50 people and where social distance is not possible. The third phase is a return to normal life across the country and a focus on identifying and isolating the infected.
Mr Trump believes the country must be reopened, that the blockade is not a sustainable long-term solution, and that America will prosper once economic activity is restarted.
Markets are welcoming trump’s decision to announce China’s GDP
U.S. stock futures rallied quickly after trump’s decision to restart the economy, extending gains to more than 3 percent.
Among them, s&p 500 futures extended gains to 3.5 per cent, a five-week high. Meanwhile, euro stoxx 50 futures were up 2.4% and ftse 100 futures rose 2.5%.
Asia-pacific stocks also continued to rally, with the MSCI Asia Pacific index excluding Japan rising to its highest level since March 12. Japan’s topix index rose 2 percent, while the nikkei 225 extended gains to 3 percent, up 20 percent since its march low, in what is expected to be a technical bull market.
The dollar index.dxy retreated below the 100-mark, away from a one-week high, and is trading around 99.80 as safe-haven demand waned.
“The dollar did well this week as record weak data suggested a longer, more uncertain road to recovery and a darker outlook, adding to appetite for safe-haven assets,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in New York.
“We think the improvement in risk appetite requires a weaker dollar,” said Scott DiMaggio, co-head of fixed income at allianz. But as long as these concerns and pressures exist, people will continue to flock to the dollar. “I don’t think it’s going to be easy to see a big move in the dollar anytime soon.”
Data on Thursday showed initial claims for state unemployment benefits fell 1.37 million in the week ended April 11 to a seasonally adjusted 5.245 million. Since March 21, 22,034 people, or 13.5% of the workforce, have applied for unemployment benefits.
Other data on Thursday added to signs that the economic downturn is deepening. Manufacturing activity in the mid-atlantic region fell to levels last seen in 1980, data showed, and home building activity in March fell by the most in 36 years.
Spot gold was volatile, dipping as low as $1,701 in the morning before recovering slightly and now hovering around $1,715.
“The market is talking about how the government is going to restart the economy,” said David Meger, director of metals trading at High Ridge Futures. Jin seems to be concerned that the peak of the outbreak is over. So from a brighter point of view, we are seeing a correction.”
“But the main story for the gold market remains that gold is fairly well supported in an environment of unprecedented monetary and fiscal stimulus by central Banks and governments around the world,” Meger added.
For the session, the focus was on China’s first-quarter GDP, which surveys now show is expected to have fallen 12% quarter-on-quarter and contracted at a 6% annualized rate in the first quarter.
At 10 am on April 17, the state council information office will hold a press conference to introduce the first quarter of the national economy. At that time, the first quarter of China’s GDP growth rate and other core economic data will be released.
A number of agencies have already forecast China’s first-quarter GDP figures. China’s economy will contract 6 percent in the first three months, according to economists’ forecasts compiled by bloomberg. However, some of the more pessimistic institutions expect the figure to be as low as -11%. This is largely due to the closure of factories, shops and schools across the country as a result of the outbreak control.
Lian Ping, chief economist and director of the research institute at uxin investment co. said China’s economic data in January and February indicate that the growth rate in the first quarter is set to fall sharply due to the outbreak. Judging by the magnitude of the adjustment, China’s figures for January and February fell more sharply than those in 2008, and there is a high probability of negative growth in the first quarter of 2020.
Liu yuanchun, vice-president of Renmin University of China, points out that even though the decline may not be as dramatic as in terms of income law, it is certain that the economy will show negative growth in the first quarter.