*ECB's Lagarde Said 3-month Lockdown Could Shrink EZ Economy 5% This Year – FAZ

Trading 18 mar 2020 Commentaire »

ECB's Lagarde Said 3-month Lockdown Could Shrink EZ Economy 5% This Year - FAZ


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*Canadian PM Trudeau Announces C$82 Bln Stimulus To Ease Covid-19 Shock

Trading 18 mar 2020 Commentaire »

Canadian PM Trudeau Announces C$82 Bln Stimulus To Ease Covid-19 Shock


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ECB's Schnabel Says Strong Fiscal Response Needed To Ease Covid-19 Impact

Trading 18 mar 2020 Commentaire »

European Central Bank Executive Board member Isabel Schnabel sought a strong fiscal response at the European level to deal with the economic crisis caused by the spread of the coronavirus, or Covid-19, and said the central bank is ready to do everything in its power to ease the impact.

"Monetary policy cannot solve this crisis on its own," Schnabel said in an interview to the German weekly Die Zeit, the text of which was published on the ECB website on Wednesday.

"Most economists agree that fiscal policy is currently the most important tool for dealing with the crisis," she said. The monetary policy aims to avoid a fragmentation in the euro area, the policymaker said. Schnabel also said that the existing growth forecast for the euro area, which is 0.8 percent for this year, will definitely be downgraded significantly.

"We are experiencing a very severe economic shock," she said.

"The likelihood of recession has therefore increased noticeably," the policymaker added.

Regarding ECB's communication, Schnabel said the ECB is ready to do everything in its mandate to address market turmoil that will disrupt monetary policy transmission. "The entire Governing Council agrees on this," she added.


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Canadian Dollar Falls As Oil Prices Tumble Amid Coronavirus Fears

Trading 18 mar 2020 Commentaire »

The Canadian dollar lost ground against its key counterparts during the European session on Wednesday, after Brent crude oil price fell below US$30 per barrel on demand worries from the spread of coronavirus.

Benchmark Brent crude fell 2.8 percent to $27.92 a barrel, after having fallen 4.3 percent on Tuesday. U.S. crude futures were down more than 5 percent at $25.93 a barrel after losing 6 percent in the previous session.

Oil prices came under pressure on account of lockdown and travel restrictions in many countries sparked by the coronavirus epidemic.

As major economies go into lockdown, the demand collapse from the spreading coronavirus looks increasingly sharp.

On the economic front, the annual inflation rate in Canada fell to 2.2% in February 2020 from 2.4% in the previous month.

The loonie dropped to more than a 4-year low of 1.4473 against the greenback, compared to 1.4203 hit late New York Tuesday. The loonie is poised to challenge support around the 1.50 mark.

The loonie fell to 9-day lows of 1.5812 against the euro and 74.38 against the yen, from its early highs of 1.5605 and 75.86, respectively. The next possible support for the loonie is seen around 1.59 against the euro and 73.5 against the yen.

In contrast, the loonie held steady against the aussie, after having risen to 0.8459 earlier in the session. The pair had closed Tuesday's deals at 0.8518.

Data from Westpac showed that Australia's leading index signaled that the economy is entering an extremely difficult coronavirus period.

The Westpac- Melbourne Institute leading index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, fell to -0.96 percent in February from -0.49 percent in January.


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*BoE's Bailey: We Are Facing An Emergency; Ready To Do Whatever We Have To Do

Trading 18 mar 2020 Commentaire »

BoE's Bailey: We Are Facing An Emergency; Ready To Do Whatever We Have To Do


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*BoE's Bailey: Don't Want Persistent Effect That Destroys Supply Capacity

Trading 18 mar 2020 Commentaire »

BoE's Bailey: Don't Want Persistent Effect That Destroys Supply Capacity


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*BoE's Bailey: Want To Minimise Economic Disruption – Reports

Trading 18 mar 2020 Commentaire »

BoE's Bailey: Want To Minimise Economic Disruption - Reports


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Iceland Central Bank Cuts Rate To Record Low

Trading 18 mar 2020 Commentaire »

Iceland's central bank slashed its key interest rate further to a new record low and the countercyclical capital buffer was lowered to zero to improve credit supply, as the economic outlook deteriorates further on the outbreak of coronavirus, or Covid-19.

The Monetary Policy Committee of the Central Bank of Iceland, on Wednesday, decided to cut the key interest rate, which is the seven-day term deposit rate, by 50 basis points to 1.75 percent.

This was the third reduction this year. The bank had reduced the rate by 50 basis points on March 11 in addition to a 25 basis-point cut in February.

The latest move eases the monetary stance still further, the bank said and assured that it is prepared to use policy instruments at its disposal in order to mitigate the adverse impact of the shock.

Further, the financial stability committee of the central bank lowered the countercyclical capital buffer to zero from 2 percent.

The capital buffers will remain unchanged for at least two years. The reduction in capital buffers would increase the lending to households and businesses.

Iceland is one of the nations that suffered severely due to the Covid-19 spread as the economy is reliant much on tourism.

Last week, the Icelandic government announced a series of measures that focused mainly on tourism and to stimulate private consumption. Among other things, the government extended deadlines for tax payment of companies experiencing operational difficulties and support to infrastructure projects.


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Loonie Little Changed After Canada CPI

Trading 18 mar 2020 Commentaire »

Following the release of Canada consumer price inflation for February at 8:30 am ET Wednesday, the loonie changed little against its major counterparts.

The loonie was trading at 1.4352 against the greenback, 74.81 against the yen, 0.8481 against the aussie and 1.5759 against the euro around 8:32 am ET.


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Dollar Little Changed Following U.S. Housing Starts

Trading 18 mar 2020 Commentaire »

After the release of U.S. housing starts and building permits for February at 8:30 am ET Wednesday, the greenback changed little against its major counterparts. The greenback was trading at 107.39 against the yen, 0.9614 against the franc, 1.1852 against the pound and 1.0970 against the euro around 8:34 am ET.


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