The Chinese yuan rose against the US dollar on Monday in Asia despite the release of downbeat manufacturing data. The Caixin PMI came in lower in February which is the lowest reading since February. Initial negative trading was seen earlier but due to the seemingly coordinated efforts by the global central bankers, the recovery in the risk sentiment prevailed.
Investors affected by the drop in global stock markets due to coronavirus fears are convinced the world’s biggest central banks will cut rates to ease the storm. Some believe the Federal Reserve will ease monetary policies in the coming months after Fed Chairman Jerome Powell pledged to “act as appropriate” to support the economy. However, he warned that Fed rate cuts will not remedy the COVID-19 virus, but they can help in facilitating access to financial capital for those greatly affected by the virus.
Ahead of the European session, most major pairs are on a recovery mode as focus turns to the Fed’s rate decision. Asian stocks also turned positive despite a rise in coronavirus patients. PMIs from Germany, UK, Eurozone, and the US will also be due.
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