Safe-haven currencies to benefit from China coronavirus outbreak – Reuters poll

According to a Reuters poll of market strategists, safe-haven currencies will continue to benefit over the coming month, in the face of the impact of the coronavirus outbreak on the world’s second largest economy, China.

Key Findings:

“Analysts said the US dollar index calculated against a basket of six currencies – and the Japanese yen were both likely to gain a maximum of around 3% if the outbreak worsened. The Swiss franc was forecast to strengthen by close to 2.0% against the euro under the same circumstances.

All three are viewed as de facto safe-haven currencies, with the yen and franc the only major currencies to have made any gains against the dollar this year.

It is also set to keep the US dollar, which has dominated most others in foreign exchange markets for around two years, on top into 2020, with half the analysts polled predicting it would last at least six months more.

A majority of analysts – 46 of 52 – who answered a separate question said emerging-market currencies were at a significant risk of weakening over the next three months.

Twenty-two of 50 said the dollar’s strength was unlikely to carry on beyond the next six months. The rest said six to 12 months or more than a year.”