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By Kate Duguid
NEW YORK, May 15 (Reuters) – U.S. The dollar rose on Friday and was intended for a small weekly gain as the threat of another wave of coronavirus infections rattled investors, as did a series of dismal U.S. financial data.
Assets in safe harbor including U.S. dollar index was offered Friday morning after the U.S. Retail sales lasted another straight month of record declines in April, as the new coronavirus pandemic kept Americans at home, putting the economy on track for its biggest contraction in the second quarter since the Great Depression.
The dollar index rose 0.07% in mid-morning trading to 100.34 and was fairly flat against the Japanese yen, another primary safe-haven currency. Further evidence that investors are moving out of risk values could be seen in the major US states. stock indices, with the S&P 500 index and the Dow Jones Industrial Average both down about 0.6%.
The collapse in retail sales reported by the Commerce Department on Friday added to the historic loss of 20.5 million jobs last month to underscore the deep economic downturn that analysts warn could take years to recover. Federal Reserve Chairman Jerome Powell on Wednesday warned of an “extended period” of weak growth and stagnant incomes.
“USD seems to put the week on a high note. It is also the best performing asset of the last month, which is also interesting as it parallels a good view of the MSCI China index, ”said Mark McCormick, global head of currency strategy at TD Securities, noting that the setup is likely was unsustainable.
New COVID-19 infections have been recorded in countries that have eased closure restrictions, preventing past investor optimism so that economies could return to normal soon. Total cases in Germany increased by 913 to 173,152 on Thursday, and the death toll increased by 101 to 7,824 after the country facilitated a nationwide recovery.
“Worldwide, we believe that markets are finally going to believe that there is no V-shaped recovery in the outlet,” McCormick said.
“Of the countries we track, 100% of them have seen their GDP forecasts downgraded for the coming year.”
The euro was last up 0.16% against the dollar at $ 1,082. Elsewhere, the British pound remained under pressure, falling 0.85% to $ 1,212, its lowest since March 26, after EU Brexit negotiator Michel Barnier on Friday said the third round of talks with Britain on a new partnership was “disappointing”.
Reporting by Kate Duguid in New York and Olga Cotaga i
London; Editing by David Gregorio