Asian stocks suffer amid worry about length of global lockdown

It was not encouraging, then, that British authorities were warning lockdown measures could last months.

US President Donald Trump on Sunday extended guidelines for social restrictions to April 30, despite earlier talking about reopening the economy for Easter.

Japan on Monday expanded its entry ban to include citizens travelling from the US, China, South Korea and most of Europe.

Bond investors looked to be bracing for a long haul with yields at the very short end of the Treasury curve turning negative and those on 10-year notes dropping a steep 26 basis points last week to last stand at 0.65%.

That drop has combined with efforts by the Federal Reserve to pump more US dollars into markets, and dragged the currency off recent highs.

Edged back

Indeed, the dollar suffered its biggest weekly decline in more than a decade last week.

Against the yen, the dollar was pinned at 107.53, well off the recent high at 111.71. The euro edged back to $1.1088, after rallying more than 4% last week.

“Ultimately, we expect the USD will soon reassert itself as one of the strongest currencies,” argued analysts at CBA, noting the dollar’s role as the world’s reserve currency makes it a countercyclical hedge for investors.

“This means the dollar can rise because of the deteriorating global economic outlook, irrespective of the high likelihood the US is also in recession.”

The dollar’s retreat has provided a fillip for gold, but fresh selling emerged on Monday as investors were forced to liquidate profitable positions to cover losses elsewhere. The metal was last off 0.3% at $1,611.42 an ounce.

Oil prices were again under water as Saudi Arabia and Russia showed no signs of backing down in their price war even as global transport restrictions hammer demand.

Brent crude futures lost $1.46 to $23.47 a barrel, while US crude fell 97c to $20.54.

Reuters