TOKYO (Reuters) – The dollar and the yen edged higher on Thursday as growing concerns about a rise in coronavirus cases underpinned safe-haven demand for both currencies.
The Australian dollar fell after data showed its economy shed twice as many jobs as expected in May, highlighting the damage caused by lockdown restrictions put in place by the government to contain the outbreak.
The British pound traded in a narrow range before a Bank of England meeting where policymakers are expected to expand quantitative easing in the face of a stuttering economy and rocky trade negotiations with the European Union.
A surge in new coronavirus infections in several U.S. states and the imposition of travel curbs in Beijing to stop a separate outbreak have served as a reminder that the pandemic could be a severe drag on the global economy for a protracted period.
“Upside for U.S. stocks and other risk assets has dwindled because more people are talking about a second wave of virus infections,” said Junichi Ishikawa, senior foreign exchange strategist at IG Securities in Tokyo.
“This supports the dollar and the yen because they are both safe havens. The pound has its own problems. The British economy is not in good shape and a hard Brexit remains a risk.”
The dollar traded at $1.1234 per euro on Thursday in Asia following a 0.2% gain in the previous session.
The greenback bought 0.9496 Swiss franc , holding onto a 0.3% gain on Wednesday.
The yen edged up to 106.79 against the dollar.
Sterling inched down to $1.2533, on course for a third day of losses. Against the euro, the pound was little changed at 89.66 pence .
A spike in new coronavirus infections and hospitalisations in several parts of the United States over the last two weeks points to a troubling trend because cases had been falling for more than a month.
China’s capital has cancelled scores of flights and blocked off some neighbourhoods to contain a coronavirus outbreak that has fanned fears of wider contagion.
The situation in both the United States and China has raised fresh concerns about the risks of re-opening economic activity before a vaccine has been developed.
The onshore yuan held steady at 7.0883 per dollar.
The People’s Bank of China on Thursday cut the rate on 14-day reverse repurchase agreements to 2.35% from 2.55% and injected 70 billion yuan ($9.88 billion) into the money market to boost liquidity.
The Australian dollar fell 0.44% to $0.6854, extending a pull back from a one-year high reached last week after data showed the Australian economy shed a quarter of a million jobs and the jobless rate jumped to the highest in almost two decades in May.
Across the Tasman Sea, the New Zealand dollar also fell to $0.6432 on equally grim data, which showed the economy shrank more than expected in the first quarter.
The yen jumped by more than half a percent against the Aussie and the kiwi , reinforcing the heightened risk aversion.
The British pound got off to a quiet start in Asia but will come into focus later in the day as traders brace for the Bank of England’s policy meeting.
The BOE is expected to boost its quantitative easing programme by 100 billion pounds ($125 billion), with some analysts eyeing an even larger increase amid concerns about the economic outlook.
Britain is seeking a free trade agreement with the EU, which it left on Jan. 31, but negotiators have so far made little progress, raising the risk both sides will fail to agree a deal before a deadline at the end of the year.
(Reporting by Stanley White; Editing by Shri Navaratnam)
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
