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·         Dollar in narrow range ahead of U.S. election, pound weakens

 

The U.S. dollar steadied on Monday as investors prepared for U.S. presidential elections on Tuesday, while a surge in global coronavirus cases continued to weigh on sentiment.

 

The greenback held onto gains after posting its largest weekly percentage rise since late September in the previous trading session.

 

The pound inched lower on cornavirus worries, after British Prime Minister Boris Johnson announced over the weekend a one-month lockdown across England.

 

Investors are sticking to the U.S. currency, which is often considered to be safe, as Tuesday’s presidential election keeps financial markets on edge.

 

The dollar index, which tracks the greenback against a basket of major currencies, last sat at 94.17 =USD, near its one-month high of 94.195.

 

Meanwhile, the novel coronavirus continues to ravage already-battered economies.

 

England’s lockdown aimed to last until Dec. 2 could be extended as Britain struggles to contain a second wave of COVID-19, a senior cabinet member said on Sunday. The United Kingdom is grappling with more than 20,000 new coronavirus cases a day.

 

Against the dollar, the pound was last down 0.39% to $1.2904 GBP=D3, with traders also eyeing updates on Brexit trade talks. EU and British Brexit negotiators will continue talks in Brussels on Monday until around mid-week, people on both sides told Reuters.

 

In Europe, new COVID-19 cases have doubled in five weeks, a Reuters tally showed, with total infections surpassing 10 million.

 

The euro steadied in Asian trade but was close to hitting long-term lows against the greenback and Japanese yen.

 

It last fetched $1.1638 EUR=EBS, extending losses after a near one-month low of $1.1640 against the U.S. dollar seen last week, while against the yen, the common currency changed hands at 121.83 EURJPY=.

 

“The euro has been selling since infection cases and lockdowns stood out in Europe,” said Daisuke Uno, chief strategist at Sumitomo Mitsui Bank.

 

“But infection cases in other countries, like the U.S., have been on a rise as well. As time goes on, I think increasing coronavirus cases and lockdowns will be common topics in any country, to the extent that they are no longer themes for the currency market,” he said.

 

The greenback was little changed against the yen at 104.72 yen JPY=EBS, away from a five-week trough of 104.02 hit on Thursday.

 

“Dollar/yen will likely remain quiet for today and tomorrow, due to the election,” Daiwa Securities chief FX strategist Mitsuo Imaizumi said, but added any dispute over vote count could lead to volatility.

 

Chinese yuan last sat at 6.6883 per dollar CNY=, as China's factory activity data, both private and official, were above analysts' expectations.

 

Besides the U.S. presidential election, this week is filled with economic data, including PMI data from the United States, euro zone and elsewhere, as well as U.S. non-farm payrolls and Chinese trade.

 

Three central banks are also due to announce policy decisions this week. The Reserve Bank of Australia meets on Tuesday, while the Bank of England and U.S. Federal Reserve deliver their decisions on Thursday.

 

·         CORONAVIRUS UPDATES:

Global Cases: 46.86M

Global Deaths: 1.20M

 

·         Trump suggests he might try to fire Fauci after the election

President Donald Trump suggested early on Monday that he might seek to fire a highly respected member of his coronavirus task force, Anthony Fauci, after Fauci further criticized Trump’s handling of the virus.

 

·         Trump campaign rallies led to more than 30,000 coronavirus cases, Stanford researchers say

President Donald Trump’s campaign rallies led to more than 30,000 coronavirus cases, according to a new paper posted by researchers at Stanford.

 

·         WHO chief says he is identified as contact of COVID-19 positive person

 

·         Britain extends help to coronavirus-hit borrowers

Britain’s financial watchdog said on Monday it would extend payment holidays on credit cards, car finance, personal loans and pawned goods before tougher coronavirus restrictions come into effect this week.

Britain announced a one-month lockdown across England would start on Thursday to contain a second wave of the pandemic.

Consumers who have not yet had a payment deferral under guidance issued in July can request one that lasts for up to six months, the Financial Conduct Authority said in a statement.

 

·         Prince William tested positive for coronavirus in April, British media reports

Unlike William’s father, Prince Charles, who announced a positive COVID-19 test in March, William, 38, kept his diagnosis secret. It wasn’t immediately clear how serious his condition was.

The diagnosis came the same month that British Prime Minister Boris Johnson said that he’d been hospitalized in an intensive care unit after testing positive for the virus.

 

·         Ryanair CEO Michael O’Leary blasts government lockdowns as traffic falls 80%

Ryanair said Monday it will operate a “significantly reduced flying scheduled” in the next six months compared to its original expectations as governments across Europe tighten social restrictions.

 

·         China’s manufacturing sector expands for sixth straight month as pandemic fallout fades, private survey shows

China’s factory activity expanded for the sixth straight month in October as business confidence grew to its strongest in years, a private survey showed on Monday.

The Caixin/Markit Purchasing Managers’ Index for Chinese manufacturing came in at 53.6 for October, better than the 53.0 forecast by analysts in a Reuters poll. The latest reading was the highest since January 2011, the survey results showed.

PMI readings above 50 indicate expansion, while those below that signal contraction. PMI readings are sequential and indicate month-on-month expansion or contraction.

China’s vast manufacturing industry has been recovering as the country’s coronavirus outbreak appears largely under control. The October Caixin/Markit PMI showed that the country’s manufacturing recovery has continued to pick up speed, said Wang Zhe, senior economist at Caixin Insight Group.

 

·         Japan opens airport coronavirus test lab for departing travellers*

Japan’s largest airport opened a novel coronavirus testing facility on Monday as it takes steps to reopen international travel that has been largely grounded for months by the pandemic.

 

The Narita International Airport PCR Center is aimed at outbound travellers who need proof that they are virus-free when they arrive at their destinations.

·         Oil falls 3% on fuel demand concerns as Europe widens COVID-19 lockdowns

 Oil prices fell more than 3% on Monday on worries that widening coronavirus lockdowns across Europe will weaken fuel demand, and as traders braced for turbulence during the U.S. presidential election week.

Brent crude futures LCOc1 for January dropped $1.34, or 3.5%, to $36.60 a barrel by 0410 GMT, while U.S. West Texas Intermediate futures CLc1 fell $1.41, or 3.9%, to $34.38.

Brent fell as much as 5.8% and WTI as much as 6% in early trade, hitting their lowest since May.

Countries across Europe have reimposed lockdown measures to try to slow COVID-19 infection rates that have accelerated in the past month.

 

Reference: Reuters, CNBC