Market Roundup
- May's Brexit deal in chaos as Speaker sparks 'constitutional crisis'
- UK PM May to formally request EU's Tusk for long Brexit delay - the Sun
- Japanese govt report to say economy in moderate recovery but warn of overseas risks-Nikkei
- Australia's central bank walks an economic tightrope between jobs and growth
- Australia Q4 Home Price Index, -2.4%, -2.0% f'cast, -1.5% prev
Economic Data Ahead
- (0530 ET/0930 GMT) Great Britain Feb Claimant Count Unem Chng, 14.2k prev
- (0530 ET/0930 GMT) Great Britain Jan ILO Unemployment Rate, 4.0% f'cast, 4.0% prev
- (0530 ET/0930 GMT) Great Britain Jan Employment Change, 120k f'cast, 167k prev
- (0530 ET/0930 GMT) Great Britain Jan Avg Wk Earnings 3M YY, 3.2% f'cast, 3.4% prev
- (0530 ET/0930 GMT) Great Britain Jan Avg Earnings (Ex-Bonus), 3.4% f'cast, 3.4% prev
- (0600 ET1000 GMT) Germany Mar ZEW Economic Sentiment, -11.0 f'cast, -13.4 prev
- (0600 ET1000 GMT) Germany Mar ZEW Current Conditions, 11.7 f'cast, 15.0 prev
Key Events Ahead
- N/A U.S. Federal Reserve's FOMC starts its two-day meeting on interest rates (to March 20) in Washington, D.C.
- (0535 ET/0935 GMT) ECB's chief economist, Peter Praet, participates in a panel discussion in Versailles
- (0900 ET/1300 GMT) Swedish Deputy Governor Cecilia Skingsley speaks in Stockholm
- (1430 ET/1830 GMT) BoE's Member of the Financial Policy Committee, Richard Sharp, speaks at Cass Business School in London
- (1950 ET/2350 GMT) BoJ releases minutes of Monetary Policy Meeting held on Jan. 22 and 23
FX Beat
DXY: The dollar index eased, hovering towards a 2-week low set in the prior session, on growing expectations the Fed will strike a dovish tone at its two-day policy meeting due to commence later in the day. The greenback against a basket of currencies traded 0.1 percent down at 96.45, having touched a low of 96.38 on Monday, its lowest since March 4. FxWirePro's Hourly Dollar Strength Index stood at -131.32 (Highly Bearish) by 0400 GMT.
EUR/USD: The euro surged, extending gains for the third straight session, on news that German economy barely avoided recession in the final quarter of 2018, as the negative impact from global trade disputes and Brexit weighed on a decade of expansion. The European currency traded 0.1 percent up at 1.1347, having touched a high of 1.1359 on Monday, its highest since Mar. 4. FxWirePro's Hourly Euro Strength Index stood at 64.56 (Bullish) by 0400 GMT. Investors’ attention will remain on German ZEW survey and EZ construction output, ahead of the U.S. factory orders. Immediate resistance is located at 1.1367 (78.6% retracement of 1.1176 and 1.1496), a break above targets 1.1408 (March 1 High). On the downside, support is seen at 1.1294 (March 4 Low), a break below could drag it till 1.1243 (Mar. 12 Low).
USD/JPY: The dollar plunged to a 5-day low against the Japanese yen, amid concerns about slower U.S. economic growth and growing expectations the Federal Reserve would shift to a more accommodative policy stance this week. The major was trading 0.1 percent down at 111.28, having hit a low of 111.15, its lowest since March 14. FxWirePro's Hourly Yen Strength Index stood at 21.77 (Neutral) by 0400 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. factory orders. Immediate resistance is located at 112.13 (Mar. 5 High), a break above targets 112.60 (Dec. 20 High). On the downside, support is seen at 111.00 (Mar. 13 Low), a break below could take it lower at 110.66 (Feb.28 Low).
GBP/USD: Sterling steadied after the speaker of Britain's parliament said Prime Minister Theresa May's Brexit deal could not be voted on again unless a different proposal was submitted. The major traded 0.1 percent up at 1.3265, having hit a high of 1.3380 on Wednesday; it’s highest since June 14. FxWirePro's Hourly Sterling Strength Index stood at 8.92 (Neutral) 0400 GMT. Investors’ will remain on UK employment data, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3319 (Feb. 28 High), a break above could take it near 1.3380 (Mar. 13 High). On the downside, support is seen at 1.3202 (Mar. 15 Low), a break below targets 1.3166 (Mar. 4 Low). Against the euro, the pound was trading flat at 85.51 pence, having hit a high of 84.71 on Wednesday, it’s highest since May 2017.
AUD/USD: The Australian dollar consolidated near a 2-1/2 week peak recorded in the prior session, after minutes of the Reserve Bank of Australia's March policy meeting showed the outlook for policy was balanced with the impact of declining house prices a major source of uncertainty. The Aussie trades flat at 0.7102, having hit a high of 0.7119 on Monday, it’s highest since Mar. 1. FxWirePro's Hourly Aussie Strength Index stood at 123.59 (Highly Bullish) by 0400 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7057 (Mar. 12 Low), a break below targets 0.6993 (Jan.4 Low). On the upside, resistance is located at 0.7150 (Feb. 22 High), a break above could take it near 0.7182 (Feb. 20 High).
NZD/USD: The New Zealand dollar held firm near an over 2-week peak, as investors eye NZ gross domestic product due on Thursday, which is likely show growth improved to 0.6 percent after a weak third quarter. The Kiwi trades 0.1 percent up at 0.6858, having touched a high of 0.6874 on Monday, its highest level Feb. 27. FxWirePro's Hourly Kiwi Strength Index was at 34.71 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6876 (Feb. 21 High), a break above could take it near 0.6901 (Feb. 27 High). On the downside, support is seen at 0.6808 (Mar. 14 Low), a break below could drag it below 0.6757 (Feb. 22 Low).
Equities Recap
Asian shares plunged, as global economic growth appeared to slow, while investors focus on the Fed meeting for clues about the likely path of U.S. interest rates.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.1 percent.
Tokyo's Nikkei fell 0.2 percent to 21,551.31 points, Australia's S&P/ASX 200 index declined 0.1 percent to 6,184.80 points and South Korea's KOSPI tumbled 0.1 percent to 2,176.72 points.
Shanghai composite index eased 0.4 percent to 3,084.68 points, while CSI300 index traded 0.7 percent down at 3,825.48 points.
Hong Kong’s Hang Seng traded 0.2 percent lower at 29,338.72 points. Taiwan shares shed 0.05 percent to 10,512.32 points
Commodities Recap
Crude oil prices traded near 2019 highs, supported by supply cuts led by producer club OPEC and U.S. sanctions against oil producers Iran and Venezuela. International benchmark Brent crude was trading 0.3 percent up at $67.63 per barrel by 0427 GMT, having hit a high of $68.11 on Thursday, its highest since Nov. 16. U.S. West Texas Intermediate was trading 0.2 percent higher at $59.09 a barrel, after rising as high as $59.12, its highest since the Nov. 13.
Gold prices rose, extending gains for a third consecutive session, as the greenback weakened on expectations that the U.S. Federal Reserve will maintain a dovish tone at its monetary policy meeting this week. Spot gold was 0.3 percent up at $1,307.53 per ounce at 0432 GMT, having touched a high of $1,311.18 on Wednesday, its highest since March 1. U.S. gold futures rose about 0.3 percent to $1,304.70 an ounce.
Treasuries Recap
The Japanese government bond prices were little changed, with the benchmark 10-year JGB yield unchanged at minus 0.040 percent, while 10-year JGB futures edged up 0.04 point to 152.82 yen. In the super-long zone, the 40-year yield was down half a basis point at 0.635 percent.
The Australian government bond futures extended their recent gains to reach heights last visited in late 2016. The three-year bond contract added 4 ticks to 98.545, while the 10-year contract firmed 3.5 ticks to 98.0500.
The yields on New Zealand government bonds fell 2 to 3 basis points to be near the lowest on record.
The Canadian government bond prices were little changed across the yield curve, with the 10-year flat to yield 1.716 percent. On Friday, the 10-year yield touched its lowest since June 2017 at 1.704 percent.
