The scenarios are eerily similar: Onlookers filming an initial explosion and fire, before a more severe explosion and shockwave sends them running and knocks them off their feet. Ammonium nitrate. Dangerous storage at an industrial port.
Warning: Links in this story contain graphic images and video. On August 4th around 6pm local time, Lebanon’s capital city of Beirut was rocked by a series of explosions in the port area of the city. The shaking from the second and largest explosion was equivalent to a 3.3-magnitude earthquake, and there are reports that it was heard and felt as far away as Cyprus, 240km away.
With the COVID-19 pandemic and the interconnected fall in global oil demand in the first half of 2020, many locations throughout the world are experiencing price changes and shortages of goods and services items.
2020 has been a year of historic economic upheaval. Shocks in the market have impacted trade, inflation, employment, national budgets—sparking an unprecedented global recession to which even stable economies are not immune.
While the COVID-19 pandemic continues to disrupt global markets, depreciation has slowed in many locations and some currencies are beginning to recover lost value. Let’s take a look at some notable currency movements of the past month.
June 1 marked a day of changing times in Venezuela. The price of gasoline in the country has been among the lowest in the world for decades, and in recent years, currency depreciation has made the resource practically free.
The COVID-19 pandemic continues to wreak havoc in global markets. In addition to the economic impacts of national lockdowns, travel restrictions, rampant unemployment, slack demand for consumer goods and sharply reduced business activity, the volatility of the oil market has reached crisis levels. While OPEC members agreed to cut production in May and June by 23% earlier this month, oil futures have continued to fall and darken outlooks for the global market this month. Crude oil prices went negative for the first time in history this month due to deficient demand for oil and looming lack of global storage capacity.
AIRINC has been providing weekly updates to spot rates of major currencies on our COVID-19 landing page. The global spread of the COVID-19 pandemic and its economic impacts landed a major blow to the global economy last month, made worse in light of volatility in oil markets sparked by controversy within OPEC+. The result has been historic depreciation in even traditionally stable currencies and unprecedented uncertainty. The last week of March saw unprecedented depreciation. While year-to-date depreciation of many currencies remains high, several major currencies saw an appreciation bump last week between April 6-13.
The outbreak of the COVID-19 pandemic has been unprecedented, and its impact to world markets has been reflected in foreign exchange. The impact of COVID-19 touches every part of the economy, and can largely be divided into three categories:
The outbreak of COVID-19 began to impact Hong Kong in late January, following the initial spread of the virus in mainland China. In the first weeks of the outbreak, supply of hygiene related goods, like masks and hand sanitizer, was unable to meet the sharp increase in demand.