The World Health Organization convened a meeting of the Emergency Committee yesterday, which was to re-verify the Organization's approach to the spreading coronavirus around the world, along with the increased number of cases in China. The World Health Organization issued a statement that reassured investors, which we could see even at the end of the session in the United States.
WHO concluded that as a consequence of current events, a global public health threat should be announced. This state can be introduced by the Organization since 2005, and has already done so five times in 2009, 2013, 2014, 2016 and 2019. We now have the sixth case of emergency in 2020. Nevertheless, the World Health Organization has stated that it does not support the travel and trade restrictions, which were introduced by some countries. This, in turn, could potentially affect the rebound of Wall Street at the end of the session.
A price of a barrel of oil could have potentially risen for similar reasons. The rebound in the price of a barrel of WTI oil from yesterday's low was over 3 percent. Moreover, Saudi Arabia was about to start talks about moving the next OPEC and OPEC + meeting from March, when it was originally scheduled for early February due to the recent very strong fall in oil prices. So far, however, no final decision has been taken regarding the new date of the meeting. Let us remind you that in just three weeks the price of oil has fallen by more than 20 percent.
We are not observing major changes this morning in the currency market. Trade is very calm at the end of the month. However, it is worth noting that January 2020 could potentially be the best month for the US dollar since July 2019. The strength of the dollar in recent times may be a result of tensions with Iran, and now by the coronavirus. Meanwhile, the Australian and New Zealand dollar could potentially be on the weakest side of January. For AUD this may be the worst month since May 2016, and for NZD it may be the worst month for over two years.
Daniel Kostecki, Chief Analyst Conotoxia Ltd.
Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
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