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· China virus toll rises to 170 as countries isolate citizens to stop global spread

Several countries began isolating hundreds of citizens evacuated from the Chinese city of Wuhan in an effort to stop the global spread of an epidemic which has killed 170, with South Korea calling for calm in the face of protests at a quarantine center.

China’s National Health Commission said the total number of confirmed deaths from the coronavirus in the country climbed to 170 as of late Wednesday and the number of infected patients rose to 7,711.



· US will keep tariffs on China even if coronavirus starts hurting growth, Trump advisor Peter Navarro says

White House trade advisor Peter Navarro pushed back Wednesday against the idea that the U.S. would remove tariffs on Chinese imports if the deadly coronavirus begins to weigh on China’s economy.

On the subject of removing tariffs due to the coronavirus, Navarro said, “Let’s remember why the tariffs are in place.”

“The tariffs are in place because China engages in massive unfair subsidies. They use their state-owned enterprises to put American companies and workers out of business,” he said. “And the tariffs also ensure that we come back for phase two.”



· South Korea's Moon urges calm amid protests over virus quarantine sites

President Moon Jae-in urged South Koreans not to give in to fear on Thursday, as the government prepared to evacuate the first of about 700 citizens from the epicenter of a new coronavirus epidemic in China’s central city of Wuhan.

Protesters used tractors on Wednesday to block the roads to facilities earmarked for quarantine centers in the cities of Asan and Jincheon, about 80 km (50 miles) south of Seoul, the capital.

The government wants to isolate evacuees for at least two weeks at the facilities, usually used as training centers for government officials, to rule out any symptoms.





· Coronavirus cases in China overtake SARS — and the economic impact could be ‘more severe’

The number of new coronavirus cases has topped 5,000 in China in just about a month, data Tuesday showed, while it took more than 6 months for the number of SARS cases in the country to reach that figure.

Tommy Wu, senior economist at Oxford Economics, told CNBC on Wednesday that this time round, “the impact could be more severe than during the SARS episode.”

“Even if the coronavirus outbreak is brought under control quicker than SARS was in 2003, the economic impact now looks likely to be of at least a similar scale,” wrote Mark Williams, chief Asia economist at Capital Economics in a note on Monday



· The dollar held near a two-month high against a basket of major currencies while the Australian dollar and the yuan were under pressure on Thursday as investors tried to shield themselves from assets that could be hit by China’s virus epidemic.

The U.S. Federal Reserve, while keeping interest rates on hold as expected on Wednesday, also cited the virus as a source of uncertainty for the economic outlook.

The dollar is the best performing currency among G10 currencies in January, with the dollar index =USD rising 1.6% so far this month to hit a two-month high.

It last stood at 98.033, flat on the day but not far from Wednesday’s two-month high of 98.026.

The yen firmed 0.1% to 108.90 yen per dollar JPY=, edging close to a three-week high of 108.73 touched last week.

The Japanese currency has fallen 0.3% against the dollar so far this month but risen against most others, adding 1.6% versus the euro EURJPY= and 3.9% on the Australian dollar AUDJPY=R.



· “While it is highly uncertain how much the disease will spread and how hard it will hit the economy, downgrades to the Chinese economy look inevitable,” said Minori Uchida, chief currency analyst at MUFG Bank.

The euro stood at $1.1009 EUR=, having touched a two-month low of $1.0992 in U.S. trade on Wednesday.

The offshore yuan dipped , trading at 6.9730 yuan per dollar CNH=, above the one-month low of 6.9900 touched on Monday. Markets in China will remain shut this week.



· FX Street EUR/USD Forecast: Fed came and left without an impact



The EUR/USD pair is trading at around 1.1010, retaining its negative technical stance in the short-term. The 4-hour chart shows that it continues to develop below all of its moving averages, with the 20 SMA providing intraday resistance. The Momentum indicator has retreated from near its mid-line, heading south, while the RSI continues to consolidate around 30, all supportive of additional declines once the pair breaks below 1.0980, the immediate support.



Support levels: 1.0980 1.0950 1.0910

Resistance levels: 1.1030 1.1065 1.1100



· U.S. economy growing moderately in fourth quarter; likely missed Trump's 3% goal in 2019

The U.S. economy likely maintained a moderate pace of growth in the fourth quarter, and probably again fell short of attaining the Trump administration’s coveted but elusive 3% annual growth target because of slumping business investment amid damaging trade tensions.

Gross domestic product probably increased at a 2.1% annualized rate in the fourth quarter as lower borrowing costs encouraged purchases of motor vehicles, houses and other big ticket items, according to a Reuters survey of economists. A smaller import bill and more government spending are also seen keeping GDP growth at the same pace logged in the third quarter.

Growth estimates for 2019 are converging around 2.5%, which would be slower than the 2.9% notched in 2018. Economists estimate the speed at which the economy can grow over a long period without igniting inflation at around 1.8%.



· Oil prices fell on Thursday as alarm spread over the economic impact of the Wuhan virus in China, while a bigger-than-expected increase in U.S. crude stocks added to the negative tone.

Brent LCOc1 was down 95 cents, or 1.6%, at $58.86 a barrel by 0738 GMT, having risen 0.5% on Wednesday. U.S. crude CLc1 was down 84 cents, or 1.6%, at $52.49 a barrel, after dropping 0.3% in the previous session.



· WTI eyes biggest monthly price loss since May 2019

West Texas Intermediate oil is on track to post its biggest and the first double-digit monthly loss since May 2019.

The black gold is currently trading at $53 per barrel, representing a 13.58% loss on a month-to-date basis. A double-digit loss was last seen in May 2019, when prices had dropped by 15.91%.


Reference: Reuters, CNBC, FX Street