FxWirePro: Daily Commodity Tracker - 21st March, 2022 
J.P. Morgan Now Expects Two ECB Rate Hikes Amid Inflation Pressures 
Asian Currencies Stay Muted as Dollar Holds Firm Amid Iran Uncertainty 
Fed Rate Cut Hopes Fade as Oil Prices Stoke Inflation Fears 
RBA Raises Cash Rate to 4.10% in Closest Vote Since Transparent Voting Began 
China Holds Benchmark Loan Prime Rate Steady for Tenth Consecutive Month 
Bank of Japan Faces Rate Uncertainty Amid Middle East Oil Shock 
ECB Eyes Rate Hike Amid Iran Conflict-Driven Energy Price Surge 
Global Central Banks Hold Rates Amid Iran War-Driven Energy Price Surge 
Cybersecurity Stocks Tumble After Anthropic's Claude Mythos AI Leak Sparks Market Fears 
The ECB’s softer tone amid downside risks to the Eurozone growth could suppress the EUR’s strength for now. ECB President Mario Draghi said in an opening statement at his news conference last Thursday that "the risks surrounding the euro area growth outlook have moved to the downside."
Meanwhile, portfolio inflows and local authorities’ measures are supportive of the high-yielding IDR, while rising expectations of the Fed to ease rate hikes and end the balance sheet reduction earlier than expected will spur risk appetite. BI Governor Perry Warjiyo told reporters in Jakarta on Friday that the central bank will soon issue a rule on special account for export earnings.
The rule is expected to encourage exporters to keep forex earnings onshore and to ease tax incentive mechanism. The BI also hopes government efforts to boost exports and foreign tourist arrivals could help improve the nation’s current account deficit. In addition, the Indonesian government plans to conduct private placement more selectively in a bid to retain onshore more than USD10 billion that was repatriated under a tax amnesty program three years ago, the report added.
The WSJ reported Friday that "Federal Reserve officials are close to deciding they will maintain a larger portfolio of Treasury securities than they’d expected when they began shrinking those holdings two years ago, putting an end to the central bank’s portfolio wind-down closer into sight."
The move would spur risk appetite across the markets, according to the report. Last but not least, US Treasury Secretary Steven Mnuchin said on Thursday that he thought the US and China were "making a lot of progress" in trade talks, with currency issues also on the agenda.
According to Bloomberg, PBoC Governor Yi Gang will join high-level trade talks led by Vice Premier Liu He. It has raised market expectations of the yuan appreciation last Friday, boosting other regional currencies as well, Scotiabank further noted.
