Forex today: the fears of recession continue to dominate the markets

Here is what you need to know on Tuesday, March 11:

The growing fear of economic slowdown in the US and its possible impact on global economic perspectives caused a massive sale in the main stock market indices at the beginning of the week. On Tuesday, the US economic calendar will include the February NFIB Business Optimism Index and January Jolts employment offers data. Meanwhile, investors will be attentive to political holders and the action in the stock markets.

On Monday, the main indices of Wall Street opened in negative territory and continued to fall, since the US president, Donald Trump, acknowledged during the weekend that they will be in a “transition period”, when asked if his policy changes could potentially cause a recession. The Nasdaq Composite fell 3.8%, the S&P 500 lost 2.7% and the Dow Jones industrial average decreased 2.08% on the first day of negotiation of the week. Meanwhile, the CBOE Volatility Index (VIX), also known as the Wall Street fear indicator, rose about 20% in the day and reached its highest level since the beginning of August. On the European morning on Tuesday, the futures of the American stock market rates marginally operate upwards.

US dollar last 7 days

The lower table shows the percentage of change of the US dollar (USD) compared to the main currencies last 7 days. American dollar was the weakest currency against the euro.

USD EUR GBP JPY CAD Aud NZD CHF
USD -3.63% -1.61% -1.56% -0.56% -0.91% -1.35% -1.89%
EUR 3.63% 2.10% 2.14% 3.19% 2.83% 2.37% 1.80%
GBP 1.61% -2.10% 0.06% 1.06% 0.72% 0.27% -0.28%
JPY 1.56% -2.14% -0.06% 1.00% 0.65% 0.19% -0.35%
CAD 0.56% -3.19% -1.06% -1.00% -0.35% -0.78% -1.34%
Aud 0.91% -2.83% -0.72% -0.65% 0.35% -0.44% -1.00%
NZD 1.35% -2.37% -0.27% -0.19% 0.78% 0.44% -0.55%
CHF 1.89% -1.80% 0.28% 0.35% 1.34% 1.00% 0.55%

The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the US dollar of the left column and move along the horizontal line to the Japanese yen, the percentage change shown in the box will represent the USD (base)/JPY (quotation).

The American dollar index (USD) closed practically unchanged on Monday, since the atmosphere of risk aversion helped the USD stay firm in front of their rivals. However, the fall in the yields of the US Treasury bonds made it difficult for the USD to gain strength. After losing 2% on Monday, the 10 -year reference treasure bond performance is maintained red below 4.2% early on Tuesday and the USD index drops slightly below 104.00.

EUR/USD He had difficulty consolidating the profits of the previous week and closed flat on Monday. The pair wins traction in the European morning and trades above 1,0850.

GBP/USD He registered small losses on Monday, but managed to stabilize about 1,2900 early Tuesday.

Japan’s data showed in the Asian session that the gross domestic product expanded at an annual 2.2% rate in the fourth quarter, below the 2.8% growth recorded in the previous quarter. Japan Economy Minister Ryosei Akazawa said Tuesday that the Japanese economy is expected to recover moderately, although those responsible for politics remain cautious about external risks. After losing around 0.5% on Monday, USD/JPY It operates slightly on the day about 147.00 on Tuesday.

The gold He failed to benefit from the fall in the yields of the US Treasury bonds and fell more than 0.5% on Monday. The Xau/USD remains in a consolidation phase around $ 2,900 in the European morning.

FAQS risk feeling


In the world of financial jargon, the two terms “appetite for risk (Risk-on)” and “risk aversion (risk-off)” refers to the level of risk that investors are willing to support during the reference period. In a “Risk-on” market, investors are optimistic about the future and are more willing to buy risk assets. In a “Risk-Off” market, investors begin to “go to the safe” because they are concerned about the future and, therefore, buy less risky assets that are more certain of providing profitability, even if it is relatively modest.


Normally, during periods of “appetite for risk”, stock markets rise, and most raw materials – except gold – are also revalued, since they benefit from positive growth prospects. The currencies of countries that are large exporters of raw materials are strengthened due to the increase in demand, and cryptocurrencies rise. In a market of “risk aversion”, the bonds go up -especially the main bonds of the state -, the gold shines and the refuge currencies such as the Japanese yen, the Swiss Franco and the US dollar benefit.


The Australian dollar (Aud), the Canadian dollar (CAD), the New Zealand dollar (NZD) and the minor currencies, such as the ruble (Rub) and the South African Rand (Tsar), tend to rise in the markets in which there is “appetite for risk.” This is because the economies of these currencies depend largely on exports of raw materials for their growth, and these tend to rise in price during periods of “appetite for risk.” This is because investors foresee a greater demand for raw materials in the future due to the increase in economic activity.


The main currencies that tend to rise during the periods of “risk aversion” are the US dollar (USD), the Japanese yen (JPY) and the Swiss Franco (CHF). The dollar, because it is the world reserve currency and because in times of crisis investors buy American public debt, which is considered safe because it is unlikely that the world’s largest economy between in suspension of payments. The Yen, for the increase in the demand for Japanese state bonds, since a great proportion is in the hands of national investors who probably do not get rid of them, not even in a crisis. The Swiss Franco, because the strict Swiss bank legislation offers investors greater protection of capital.

Source: Fx Street

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