Pay attention to the novel coronavirus (risk-off, responses of each country). Important events of this week you should know in 1 minute by Okachan-man (week of March 9)
This week's economic indicators! There is one important event that Okachanman is focusing on
① Novel coronavirus (risk-off, measures by countries)
Ancient FX Blog
(the following is the transcription of the video)
Hello everyone, this is Okachanman. As for what Okachanman's focus is this week, following last week's lead, the coronavirus remains the focus. I'm paying attention to these two aspects: coronavirus risk-off and how countries respond.
First, risk-off: a state of emergency was announced last week in California. With this announcement, stock prices fell and risk-off progressed. It was also announced in New York over the weekend, causing the market to open with a large gap on Monday. When a state of emergency is announced, stock prices respond in that way. In the United States, the number of infections and affected regions is gradually expanding, so such a situation could push risk-off further.
Moreover, not only in the United States but worldwide, border controls and entry restrictions are being imposed. Japan has restricted entry from China and Korea. When such country-to-country travel restrictions are implemented, movement of people and goods decreases and the economy stagnates. This leads to stock prices falling and risk-off taking hold.
Therefore, while watching the spread of infections and infected regions, I want to pay attention to whether risk-off will occur.
What kind of measures will each country take in response? Last week, the United States, Canada, and Australia made substantial rate cuts, yet stock prices continued to fall. This week there is an ECB Council meeting on Thursday the 12th at 21:45 JST, and I’m curious about what measures will come out. However, even with monetary policy, it might not be enough, so I’m wondering what kind of fiscal measures will be taken by each country. Whether fiscal and monetary policies can stop risk-off is the focus this week, I think.
Additionally, last week's OPEC meeting ended in a failure to coordinate production cuts, so crude oil prices have dropped. While that is a factor for risk-off, I still think the coronavirus is the bigger factor now.
Like last week, I expect this week will be highly volatile, so I want to manage risk carefully.
Now, let's do our best this week as well. This was Okachanman.
