The dollar bounced back against other major currencies following political statements from the White House that showed a willingness to act, through concerted economic policies, to mitigate the fallout from the coronavirus crisis.
The focus of the markets is very unlikely to divert from the virus’ impact on the public health and economic prospects of several countries, including of course Italy, but also, and crucially, the United States, where some suspect the numbers of infected may be much higher than the figures published so far indicate.
Some of yesterday’s anxiety was driven by the fear of seeing the US finding itself in a situation similar to that already witnessed in China and Italy. The next few days will determine if today’s rebound in the market is to continue, or if it is not more than the proverbial ‘dead cat bounce’.
