The euro has posted gains Thursday amid talk of a new debt instrument to combat the coronavirus outbreak as the death toll rises and the economic damage becomes more stark.
At 4:10 ET (0810 GMT), EUR/USD traded at 1.0938, up 0.5%.
Elsewhere, the U.S. Dollar Index, which tracks the greenback against a basket of six other currencies, stood at 100.580, down 0.4%. USD/JPY fell 0.7% to 110.44, while GBP/USD traded at 1.1950, up 0.5%.
Europe has become the fiercest battleground in the war against the Covid-19 outbreak, with well over 180,000 cases confirmed. The death toll keeps rising across the region, with Italy now registering a higher number than China, and Spain not far behind. However, the rate of new infections appears to be slowing rapidly in most countries across the continent, with the exception of the U.K., analysts at Pantheon Macroeconomics said in a note to clients.
The measures designed to combat the deadly virus has brought all the key EU economies to a standstill. The latest data show the extent of the damage, with German consumer morale hitting its lowest level since 2009 while French business confidence plunged at a record pace in March, to its lowest since 2014.
While the ECB has launched a gigantic new package of quantitative easing, it’s clear the extent to which individual countries can combat the pandemic depends on the strength of their balance sheets.
With this in mind, nine European countries late Wednesday called upon their EU counterparts to issue so-called corona bonds — a new debt instrument that would combine securities from different countries and put the firepower of German taxpayers behind the joint borrowing.