Asian session review: the US dollar traded steadily against the euro and rose slightly against the yen

During today's Asian trading, the us dollar traded steadily against the Euro, rose slightly against the yen and fell against the pound.

The spread of the Covid-19 coronavirus outside China is causing strong investor concern that the consequences for the global economy will be more dramatic than previously thought. Analysts are starting to think that the Federal reserve may cut interest rates in response. A number of them expect that the rate cut before the end of this year could reach 50 basis points from the current 1.5-1.75% per annum.

DBS analysts predict that the yen may weaken and move into the range of 110-115 yen/$1 after weak statistics on the state of the country's economy. The Japanese economy fell at its fastest pace in 5.5 years in the fourth quarter, following a 6.3% increase in the country's consumption tax compared to the same period in 2018. The reduction in GDP occurred for the first time since the third quarter of 2018. DBS expects that the Japanese economy may show a decline this quarter, resulting in a technical recession for the first time since 2012.

The ICE Dollar index, which shows the value of the dollar against six major world currencies, fell by 0.05% compared to the previous day. For much of last week, it was near a three-year high, but started losing ground on Friday and Monday.