Chinese Businesses Combat Virus with Layoffs, Loans | Powell Heads to Capitol Hill
Published February 11, 2020
As the death toll passes 1,000, and more than 40,000 cases in China alone, the impact of the coronavirus on human life cannot be understated. The World Health Organization is warning of a “grave threat” for the world if the outbreak cannot be contained soon. From an economic standpoint, Chinese businesses are struggling to weather the storm. Many firms are resorting to layoffs and bank loans to combat the effects of the state-imposed quarantine measures that have disrupted global supply chains and hindered domestic growth.
Today begins the first of two days of Capitol Hill testimony for Federal Reserve Chairman Jerome Powell. Powell will deliver his semi-annual testimony to congress providing a broad overview of the economy and US monetary policy. With the US dollar riding a six-day streak of gains and sitting at four-month highs, reassuring testimony from Powell on the economy could further propel both the dollar and equity markets higher.
The euro fell below 1.09 against the dollar this morning and is in danger of falling to multi-year lows as we approach Powell’s testimony at 10:00 am EST and European Central Bank President Lagarde’s testimony European lawmakers at 9:00 am EST. The two testimony, along with any coronavirus headlines, could determine whether the euro stabilizes or falls towards 2017 lows.