· China virus evacuations begin as death toll rises at outbreak epicenter
Foreign governments began flying their citizens out of China’s Hubei province, the epicenter of the coronavirus outbreak, as authorities said the death toll there had topped 160.
The health commission for Hubei said on Thursday that deaths in the province from the new coronavirus had risen by 37 to 162, while a further 1,032 cases had been detected.
Although the majority of cases have been in Hubei, cases have been detected elsewhere in China and in at least 15 other countries.
· The case count for the province has gone up by 1,032, and death toll has gone up by 37 from the previous day.
This brings the number of cases for mainland China to over 7,000 and the death toll for mainland China to 170.
· WHO to reconsider declaring global emergency as China virus evacuations begin
Foreign governments flew their citizens out of the epicentre of China’s coronavirus outbreak on Wednesday, as the number of deaths jumped to 133 and the World Health Organization voiced “grave concern” about person-to-person spread in three other countries.
The WHO said its Emergency Committee would reconvene behind closed doors on Thursday to decide whether the rapid spread of the new virus from China now constitutes a global emergency.
· Fed keeps rates steady, to tailor Treasury bill purchases later this year
The Federal Reserve held interest rates steady on Wednesday at its first policy meeting of the year, with the head of the U.S. central bank pointing to continued moderate economic growth and a “strong” job market, and giving no sign of any imminent changes in borrowing costs.
“We believe the current stance of monetary policy is appropriate to support sustained economic growth, a strong labor market and inflation returning to our symmetric 2% objective,” Fed Chair Jerome Powell said at a news conference following the central bank’s unanimous decision to maintain the key overnight lending rate in a range of between 1.50% and 1.75%.
He noted signs that global economic growth was stabilizing and diminishing uncertainties around trade policy, concern about both of which were key factors in the Fed’s decisions to cut rates three times last year.
But, he added, “uncertainties about the outlook remain, including those posed by the new coronavirus.” The outbreak of the new flu-like virus in China has led to fears of a further slowdown in the world’s second-largest economy.
“We are very carefully monitoring the situation,” Powell told reporters, adding that while the implications of the outbreak for China’s output are clear, it is “too early” to determine its global effect or impact on the U.S. economic outlook.
· The Fed’s statement did not announce any immediate changes to the central bank’s current practice of buying $60 billion monthly of U.S. Treasury bills to ensure adequate short-term liquidity in bank funding markets.
But Powell said the Fed would likely begin scaling back that amount sometime in the April-June period, when the amount of reserves in the banking system would likely be deemed adequate.
· The dollar held near two-month highs on Wednesday and other currencies seen as safe havens stabilized as investors regained their composure after an outbreak of coronavirus in China, awaiting more news on possible economic damage.
The dollar index was last up 0.07% at 98.15, while the euro was down 0.15% versus the U.S. currency at $1.1003, not far from its weakest since early Nov. 29.
The greenback is now up 1.8% against a basket of major currencies so far in 2020, ahead of a Federal Reserve meeting later on Wednesday.
ING analysts said that with the market already pricing in another 25 basis point rate cut from the Fed in 2020, the U.S. currency looked like it would hold recent gains.
Sterling fell 0.1% to $1.3020 ahead of a Bank of England meeting on Thursday. Investors are divided as to whether it will cut rates.
· The U.S. goods trade deficit rose sharply in December as imports rebounded and businesses became more cautious on accumulating inventory, prompting some economists to cut their fourth quarter economic growth estimates.
The housing market also provided some discouraging news on Wednesday, with contracts to purchase previously owned homes dropping by the most in more than 9-1/2 years in December. The housing market has been regaining momentum after slumping in 2018 and the first half of 2019, thanks to lower mortgage rates.
The Commerce Department said the goods trade gap, which had dropped for three straight months due to declining imports, surged 8.5% to $68.3 billion last month.
· President Donald Trump on Wednesday signed a new North American trade agreement during an outdoor ceremony at the White House attended by about 400 guests - but not the key Democrats who helped secure congressional passage of the deal.
The U.S.-Mexico-Canada Agreement (USMCA) will replace the 26-year-old North American Free Trade Agreement, including tougher rules on labor and automotive content but leaving $1.2 trillion in annual U.S.-Mexico-Canada trade flows largely unchanged.
A wide array of business groups welcomed the agreement, which also won a rare endorsement of the AFL-CIO union federation. Mexico has already approved the deal, but it must still be ratified by Canada’s parliament before it can take effect.
U.S. lawmakers said it was unclear when the accord would take effect, since Canada’s main opposition Conservative Party had expressed concerns about aspects of the deal and there was no exact timeline for ratification there.
· A Democratic push to force Republicans to accept witnesses at Donald Trump’s impeachment trial in the U.S. Senate appeared to be flagging on Wednesday, raising the possibility the president could be acquitted as early as Friday.
· Oil fell on Wednesday as worries about the impact of the coronavirus outbreak on demand and a larger-than-expected build in U.S. inventory weighed on prices, although losses were offset by talk that OPEC could extend oil output cuts.
Brent crude gained 30 cents to settle at $59.81 per barrel. U.S. West Texas Intermediate crude slid 15 cents, or 0.3%, to settle at $53.33 per barrel, for its sixth negative session in 7 trading days.
Reference: Reuters, CNBC
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