US dollar rally last night while stocks fell

Good Morning,

- US dollar rally last night while stocks fell, as Fed minutes more hawkish than the market expected. Euro trade stable today morning, as markets looking for the next trigger.

- Japan's Nikkei -1.65%, Hong Kong's Hang Seng -1.81%, Korea's Kospi -0.94%, Australia's ASX 200 -1.12% and China's Shanghai -1.40%.

- US stocks were sent lower yesterday after Yellen's suggestion that the Fed may start to hike interest rates as early as April 2015. No exact timeline was given, but the Fed's Chairman wasn't coy when asked how long the Fed would wait until after the QE tapering ends before they start to raise interest rates.

- The FED’s Minutes showed that the Fed is still on track to continue tapering and that indeed they think the economy is now strong enough for rates to be higher in 2015 and 2016 than they previously thought. They also dropped the 6.5% guidance on employment in favour of a broader range of indicators which got the market in a funk.

- Federal Reserve officials predicted their target interest rate would be 1 percent at the end of 2015 and 2.25 percent a year later, higher than previously forecast, as they upgraded projections for gains in the labor market. Most Federal Open Market Committee participants reiterated their view that the Fed will refrain from raising the benchmark interest rate until 2015. The median rate among 16 Fed officials rose from December, when they estimated the rate at the end of next year at 0.75 percent, and 1.75 percent for the end of 2016.

- A majority of FOMC participants - 13 out of 16 - expect the first increase in the main interest rate in 2015. One projected the first rate increase in 2014, while two forecast an initial move in 2016.

- Also FOMC predicted the unemployment rate will be 6.1 percent to 6.3 percent in the fourth quarter of 2014, and fall to 5.6 percent to 5.9 percent at the end of 2015 and 5.2 percent to 5.6 percent a year later.

- German producer prices for industrial products fell by 0.9% from the corresponding month of the preceding year. While prices of consumer non-durable goods increased by 1.3% prices of intermediate goods were 1.9% low and energy 2.6% low compared with February 2013.

- Moody's expects UK 2014 budget to be consistent with UK's AA1 bond rating.

- Ukraine removes military from Crimea to mainland.

- The Swiss National Bank is not expected to lift its lid on the Swiss franc until at least 2015, a Reuters poll showed on Tuesday, with some economists suggesting the central bank may never need to officially exit the currency cap at all.

- Swiss trade surplus widens to 2.6 bln sfr in Feb.

- The Yuan has weakened over 250 pips in China trading. Trading at almost 6.22, we are now deeply into the significant-loss-realizing region of the world's carry-traders and Chinese over-hedgers. Morgan Stanley estimates a minimum $4.8bn loss for each 100 pip move. However, the bigger picture is considerably worse as the vicious circle of desperate liquidity needs are starting to gang up on Hong Kong real estate and commodity prices.

- On Commodity markets, gold was poll axed and has broken out of the recent uptrend it has been trading in falling around $20 oz to $1329.95 this morning. Copper went the other way however rising to $3.02 lb after a big fall early in the day while Crude oil is back above $100 Brl at $100.29.

- Watch today: US jobs, retail sales and home sales.

Have a nice Day !