The dollar was near flat on Wednesday morning amid continuously rising numbers of COVID-19 cases. There are almost 11.8 million COVID-19 cases globally as of July 8, according to Johns Hopkins University data, including – as of Tuesday – Brazilian President Jair Bolsonaro, a vocal sceptic of the pandemic.
Investor sentiment was further dampened over a warning from several U.S. Federal Reserve officials that the rising number of cases could jeopardize economic recovery, with some stimulus programs from central banks due to expire soon.
On the currency market, EUR/USD trades at 1.1290, USD/JPY down to 107.43 while GBP/USD at 1.2563.
European stock markets opened lower on Wednesday, with investors wary of chasing recent gains ahead of the second-quarter earnings season, while the European Central Bank signals it could now be on hold for some time.
Oil prices weakened after the U.S. Energy Information Administration said it expects U.S. crude oil production to fall by 600,000 barrels a day in 2020, a smaller decline than the 670,000 barrels it forecast previously, prompting worries of oversupply. Additionally, the American Petroleum Institute said U.S. crude oil stockpiles rose by 2 million barrels last week, defying expectations of a draw. Government data are due later Wednesday.
Gold remained close to its recent highs, above $1,790. The precious metal hit $1,797 on Tuesday, the highest since 2012.
The focus will stay on risk still, with investors looking at what to make do of recent virus developments and the constant ebullience by the market to shrug off concerns, in the absence of any major market-moving economic releases, either from the Eurozone or the US.