US DJ Index dropped 1861 on June 11

The safe haven dollar, yen and Swiss franc strengthened yesterday after US stock markets plummeted amid easing expectations that the global economy will recover quickly from the Covid-19 crisis. Market players avoid risky currencies such as the euro, sterling and the Australian dollar. The safe haven currency strengthened after the Fed expressed a gloomy view of the economic outlook. The Fed said it would support the US economy by using various policy tools. The Fed also expects the US economy to contract 6.5% this year, with the unemployment rate at 9.3%. Safe haven is also sticking out due to fears of the spread of the second wave of corona virus. The number of infected in the US has again increased after 5 weeks of decline. The dollar index gained 0.4% to 96,556.

The Canadian dollar weakened 1.5% against the US dollar to 1.3616, the biggest decline since April 15. The drop in oil prices due to concerns about the second wave of the corona virus was one of the factors that made the Canadian currency corrected. Oil commodities are the mainstay of Canadian exports. Meanwhile, Canadian government bond yields fell 4.6 bps to 0.520%.

Gold weakened yesterday due to the strengthening of the dollar. However, concerns about the soaring number of cases infected with the corona virus, as well as the Fed's policy of keeping interest rates low, hold gold to remain near its highest level one week. The dollar strengthened against other major world currencies, driven by safe haven after Wall Street's decline following news of a surge in cases of infection by the corona virus in the US, after the states loosened lockdowns.

Oil prices plummeted yesterday due to growing concern about the second spread of the corona virus coupled with the gloomy outlook for the US economy delivered by the Fed chairman at his meeting yesterday. Covid-19 is the main cause of the decline in oil prices. While many countries are loosening lockdown rules with health protocols, it is not according to plan. It took the US almost three months to reach number 1 as well as confirmed cases, but with only six weeks to double it. On Wednesday, the number of infected in the US passed 2 million, with many states reporting a significant spike after

loosening the lockdown. Oil prices were also pressured due to fears of oversupply following EIA data which showed US oil reserves rose 5.7 million barrels, against an estimated drop of 1.8 million barrels. Meanwhile, the Fed at its meeting this week estimates the US economy will contract by 6.% this year.

Asian stocks were poised to continue losing ground after Wall Street and oil prices tumbled amid fears of a second wave of corona viruses. The three main Wall Street indexes fell more than 5% yesterday, the worst decline since mid-March. The number of cases of infection in the US state continues to increase, raising concern that the lockdown easing policy is premature.

Today's Focus: UK GDP and US Consumer Sentiment

At the end of trading this week, market participants were still treated to some data, both from Europe and the United States (US). These data include UK GDP and US consumer sentiment. British GDP contracted 5.8% in March due to the economic closure of Covid-19. In April, UK GDP is expected to contract deeper, at 18.0%. In the US, there is data on consumer sentiment

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