* Safe havens gain as coronavirus threatens economic
slowdown
* Fed cuts rates to zero, launches QE
(New throughout, updates prices, market activity and comments
to U.S. market open, new byline, changes dateline, previous
LONDON)
By Karen Brettell
NEW YORK, March 16 (Reuters) - The safe haven Japanese yen
jumped on Monday as concerns about the spreading coronavirus
sent investors running from higher risk assets, even after the
U.S. Federal Reserve slashed rates to zero and launched new
quantitative easing.
The Fed cut U.S. interest rates on Sunday and said it would
expand its balance sheet by at least $700 billion in the coming
weeks. The move is expected to help resolve some market
dislocations including illiquidity in the U.S. Treasury market,
but it may not benefit companies that are struggling as people
avoid going out because of the virus, and as businesses face
mandatory shutdowns.
“What's needed is more direct support to industries that are
hit directly by the virus. That can only be provided by fiscal
policy, and governments have not shown the same swift reaction
that central banks have,” said Marshall Gittler, head of
investment research at BDSwiss Group.
The dollar dipped 2.19% to 105.55 yen JPY= .
The euro EUR= gained 0.33% against the greenback to
$1.114.
The greenback has gained in the past week as companies draw
on credit lines and bank lenders seek out the currency to fund
the loans. That has led to strains in sourcing dollars.
To address this, the Fed and other major foreign central
banks also cut pricing on their swap lines to make it easier to
provide dollars to financial institutions around the world.
Multiple global central banks acted to ease conditions on
Monday.
The Bank of Japan said at an emergency meeting it would buy
more corporate bonds, commercial debt and establish a new
corporate lending scheme. New Zealand's central bank slashed
rates in an emergency move while the Reserve Bank of Australia
(RBA) injected extra cash into the financial system.
The People's Bank of China also injected 100 billion yuan
($14.28 billion) into financial institutions on Monday.
The move came minutes before data showed China's retail
sales, industrial output and fixed-asset investment all tumbled
in January and February.
"The measures introduced to stop the spread of the virus in
China may have led to a sharper slowdown in activity than will
be the case elsewhere, but it's clear that the measures central
banks have taken, and whatever they do next, cannot prevent a
major economic hit being felt globally," Societe Generale
strategist Kit Juckes said.
The dollar gained 0.07% against the offshore yuan CNH= to
7.025.
========================================================
Currency bid prices at 9:50AM (1350 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1142 $1.1105 +0.33% -0.62% +1.1236 +1.1047
Dollar/Yen JPY= 105.5500 107.9100 -2.19% -3.04% +107.9100 +105.1600
Euro/Yen EURJPY= 117.61 119.91 -1.92% -3.56% +119.8700 +117.1700
Dollar/Swiss CHF= 0.9461 0.9496 -0.37% -2.24% +0.9544 +0.9393
Sterling/Dollar GBP= 1.2249 1.2276 -0.22% -7.62% +1.2429 +1.2232
Dollar/Canadian CAD= 1.3978 1.3803 +1.27% +7.64% +1.3986 +1.3735
Australian/Doll AUD= 0.6105 0.6182 -1.25% -13.05% +0.6303 +0.6081
ar
Euro/Swiss EURCHF= 1.0542 1.0559 -0.16% -2.86% +1.0594 +1.0543
Euro/Sterling EURGBP= 0.9094 0.9045 +0.54% +7.56% +0.9134 +0.8989
NZ NZD= 0.6028 0.6057 -0.48% -10.51% +0.6153 +0.5945
Dollar/Dollar
Dollar/Norway NOK= 10.3536 9.9961 +3.58% +17.93% +10.3996 +9.9957
Euro/Norway EURNOK= 11.5363 11.1250 +3.70% +17.25% +11.5866 +11.1287
Dollar/Sweden SEK= 9.8122 9.7081 +1.42% +4.97% +9.8755 +9.5878
Euro/Sweden EURSEK= 10.9371 10.7840 +1.42% +4.47% +10.9955 +10.7737