Market Roundup
- China NBS Mfg PMI, 50.3 vs 51.3 last , 51.2 f'cast
- China NBS Non-Mfg PMI, 54.40 vs 55.30 last
- Japan Jan industrial output -6.6% m/m, -4.2% eyed, Feb eyed at +9.0%, Mar -2.7%
- Japan Jan retail sales +1.6% y/y, +2.1% eyed, Dec +3.6%, Nov +2.1%
- BoJ trims JGB purchases with 25-40 years maturity to Y70 bln from Y80 bln
- Fed's Powell nods to stronger economy, backs gradual rate hike path
- Senate Republican says U.S. infrastructure bill may not pass this year
- Mexico trade minister to meet Ross in Washington - sources
- U.S. finds China aluminum foil imports dumped, subsidized
- EU's Barnier warns time running out for Brexit deal
- Mood among UK consumers and businesses cools in February - surveys
- ECB could end bond buys this year: Weidmann
- Australia Jan Private sector credit, 0.3% vs 0.3%, Jan Housing credit, 0.5% vs 0.4%
- New Zealand Feb NBNZ Business Outlook, -19.0% vs -37.8% - ANZ survey
Economic Data Ahead
- (0245 ET/0745 GMT) France Q4 GDP q/q, 0.60% eyed, 0.60% prev
- (0245 ET/0745 GMT) France Feb CPI (EU Norm) prelim y/y, 1.5% eyed, 1.5% prev
- (0245 ET/0745 GMT) France Jan Consumer Spending m/m, 0.4% eyed, -1.2% prev
- (0400 ET/0900 GMT) Germany Mar GfK Consumer Sentiment, 10.9 eyed, 11.0 prev
- (0400 ET/0900 GMT) Germany Feb Unemployment change SA, -15k eyed, -25k prev
- (0400 ET/0900 GMT) Germany Feb Unemployment rate SA, 5.4% eyed, 5.4% prev
- (0500 ET/1000 GMT) EU Feb Inflation flash y/y, 1.2% eyed, 1.3% prev
- (0500 ET/1000 GMT) EU Feb Inflation flash ex food & energy, 1.1% eyed, 1.2% prev
Key Events Ahead
- (0500 ET/1000 GMT) Norges Bank Governor Oystein Olsen gives a speech at the University of Oslo
- (0535 ET/1035 GMT) Germany E3.0 bln for 10-year auction
- (0800 ET/1300 GMT) Canada Finance Minister Bill Morneau speaks in Ottawa
- (1100 ET/1600 GMT) Riksbank Governor Stefan Ingves speaks in Sweden
- N/A EBRD USD SEC-exempt 5-year global benchmark via BMO/Citi/GS/TD.
- N/A Municipality Finance USD1 bln 5-year benchmark via HSBC/JPM/Mizuho/Nomura
FX Beat
DXY: The dollar steadied near a 2-week high touched in the previous session after Federal Reserve Chairman Jerome Powell's upbeat views on the economy boosted bets on further Fed interest rate hikes this year. The greenback against a basket of currencies traded flat at 90.39, having touched a high of 90.50 on Tuesday, its highest since Feb. 9. FxWirePro's Hourly Dollar Strength Index stood at 82.24 (Slightly Bearish) by 0500 GMT.
EUR/USD: The euro slumped to near 3-week lows as Italians prepare to vote in a national election on Sunday, and the leading political parties in Germany decide on a coalition deal that could secure Angela Merkel a fourth term as chancellor. The European currency traded 0.1 percent down at 1.2224, having touched a low of 1.2215, its lowest since Feb. 9. FxWirePro's Hourly Euro Strength Index stood at -76.83 (Slightly Bearish) by 0500 GMT. Investors’ attention will remain on Eurozone consumer price index, ahead of U.S. gross domestic product and pending home sales. Immediate resistance is located at 1.2291 (5-DMA), a break above targets 1.2356 (10-DMA). On the downside, support is seen at 1.2205 (Feb 9 Low), a break below could drag it lower 1.2165.
USD/JPY: The dollar eased against the Japanese yen after the Bank of Japan trimmed the amount of super-long Japanese government bonds it offered to buy at its regular debt buying operation. The major was trading 0.2 percent down at 107.12, having hit a high of 107.90 last week, its highest since Feb.14. FxWirePro's Hourly Yen Strength Index stood at 80.95 (Slightly Bullish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. gross domestic product and pending home sales. Immediate resistance is located at 107.90 (Feb 21. High), a break above targets 108.50. On the downside, support is seen at 106.09, a break below could take it lower 105.60.
GBP/USD: Sterling declined, extending losses for the third straight session after Federal Reserve chief Jerome Powell's comments that the central bank would stick to gradual rate rises boosted the dollar. The major traded 0.05 percent down at 1.3900, having hit a low of 1.3858 on Thursday, it’s lowest since Feb 14. FxWirePro's Hourly Sterling Strength Index stood at 2.91 (Neutral) by 0500 GMT. Investors’ focus will remain on the U.S. fundamental drivers, as UK economic data remains absolutely data empty. Immediate resistance is located at 1.3942 (5-DMA), a break above could take it near 1.3989 (21-DMA). On the downside, support is seen at 1.3858 (Previous Session Low), a break below targets 1.3800 (Feb 14 Low). Against the euro, the pound was trading 0.05 percent down at 87.95 pence, having hit a high of 87.71 pence on Thursday, it’s highest since Feb. 8.
AUD/USD: The Australian dollar steadied after falling to a 2-week low earlier in the session on expectations of faster rate hikes in the United States. The Aussie trades 0.1 percent up at 0.7793, having hit a low of 0.7781 earlier; it’s lowest since Feb 14. FxWirePro's Hourly Aussie Strength Index stood at 16.34 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7773 (Feb 14 Low), a break below targets 0.7723. On the upside, resistance is located at 0.7825 (5-DMA), a break above could take it near 0.7890 (21-DMA).
NZD/USD: The New Zealand dollar retreated after tumbling to a 2-week low on fuelled speculation Fed members would lift their projections for interest rates this year when they next meet in March. The Kiwi trades flat at 0.7233, having touched a low of 0.7220, its lowest level since Feb. 14. FxWirePro's Hourly Kiwi Strength Index was at -53.46 (Bearish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7297 (5-DMA), a break above could take it near 0.7336 (10-DMA). On the downside, support is seen at 0.7209 (Feb. 7 Low), a break below could drag it below 0.7176 (Feb. 8 Low).
Equities Recap
Asian shares extended its recovery momentum, while the greenback slightly eased ahead of Federal Reserve Chairman Jerome Powell's highly-anticipated first congressional testimony later in the day.
Asian shares declined as weak factory data from China revived worries about global economic growth, while the greenback steadied near a 2-week peak on prospects of faster rate rises in the United States.
MSCI's broadest index of Asia-Pacific shares outside Japan plunged 0.7 percent.
Tokyo's Nikkei fell 1.4 percent to 22,068.24 points, Australia's S&P/ASX 200 index slumped 0.7 percent to 6,016.00 points and South Korea's KOSPI tumbled 0.4 percent to 2,445.34 points.
Shanghai composite index declined 1.01 percent to 3,258.82 points, while CSI300 index was trading 0.9 percent down at 4,023.89 points.
Hong Kong’s Hang Seng was trading 0.9 percent lower at 30,974.49 points.
Commodities Recap
Crude oil prices declined as weak Chinese factory data triggered concerns of an economic slowdown that could lower oil demand and, in the United States, while industry data showed an increase in crude stockpiles amid its soaring output. International benchmark Brent crude was trading 0.2 percent down at $66.26 per barrel by 0447 GMT, having hit a high of $67.86 the day before, its highest since Feb. 7. U.S. West Texas Intermediate was trading 0.2 percent down at $62.69 a barrel, after rising as high as $64.21 on Monday, its strongest since Feb. 7.
Gold prices slumped after falling to a near 3-week low on new that the U.S central bank chairman pledged to stick with gradual interest rate increases. Spot gold was 0.1 percent down at $1,317.01 an ounce by 0451 1834 GMT, having fallen to its lowest level since Feb. 9 at $1,313.36 in the prior session. April U.S. gold futures settled down $14.20, or 1.1 percent, at $1,318.60 per ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.902 percent lower by 0.005 bps, while 5-year yield was 0.01 bps up at 2.678 percent.
The Japanese government bond prices edged lower oas the market was weighed down following a retreat by U.S. Treasuries. The two-year yield rose 0.5 basis point to minus 0.160 percent and the benchmark 10-year yield climbed 0.5 basis point to 0.045 percent.
The Australian government bond futures followed Treasuries lower, with the three-year bond contract off 4.5 ticks at 97.890. The 10-year contract eased 4.5 ticks to 97.2100.
The New Zealand government bonds eased, sending yields 2.5 basis points higher at the long end of the curve.
