Early on Thursday the Japanese yen witnessed a sharp spike against the US dollar as coronavirus fears once again increase the demand for the safe haven currency after the Chinese province of Hubei reported a sudden hike in infected cases. At the time of writing, USD/JPY is trading around 109.87.
The risk-off sentiment came back to dominate markets with Asian stocks sliding lower while the Chinese Yuan also faltered against the US dollar. On Thursday, Hubei confirmed that over 14,000 people were infected with the coronavirus, a rise of more than 1,600 since Tuesday. Meanwhile, the death toll in the region rose above 1,300.
Coronavirus concerns continue to plague global financial markets after the WHO drew similarities between the outbreak and that of terrorism, heightening fears about the economic impact from the pandemic. The Chinese government has already rolled out several measures to support the possible weakness in its economic growth and is expected to unveil more such measures in the near future.
Despite this, however, the virus is expected to have a significant impact on economic growth not just in China but across Asian markets. It is too soon to speculate on the extent of damage the virus can cause to Asian economies just yet.