Currency Outlook

FEBRUARY 2020 CURRENCY OUTLOOK – IN BRIEF

What Happened

  • Chaotic start to the year as a deadly virus originated in China derails economic activity
  • U.S. Dollar maintained a resilient stance, rose by 0.6% overall as a safe-haven
  • Brexit Day came and went, but no interest rate cuts allowed Pound to stay afloat, gained 0.4%.
  • Europe’s confirmation of a slow Q4 and anemic January cost the shared currency 0.7% in value
  • Declines across markets, gripped by fear over the coronavirus effects, boosted CHF by 0.8%
  • China’s Phase I and USMCA trade agreements were signed by President Donald Trump

Tempus’ View

  • Boris Johnson’s turn away from a “smooth Brexit” trade deal will hurt Sterling
  • Ongoing worry over the coronavirus likely to reveal an ailing world economy
  • Greenback is likely to move quietly and in mixed ranges as the globe adjusts to risks
  • A turnaround for equities and commodity-based currencies could arrive if news improves on contain/eliminating the disease
  • 2020 is supposed to be a year of major transition and trade resolution, but the unforeseen health crisis is slowing everything

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