Forex today witnessed the resurgence of the US dollar demand across the board, prompting most majors to pause their relief rally, as Treasury yields regained poise, after a brief correction, ahead of the Fed’s bi-annual monetary policy report due for release later on Friday. The Kiwi emerged the biggest loser, despite a better-than-expected NZ retail sales report and stabilizing oil prices while its OZ counterpart, the Aussie, traded with mild losses below the 0.7850 barrier. USD/JPY’s tepid bounce ran into offers at the 107 handle that left the rates in a phase of consolidation over the last hours.

Among other related markets, the Asian equity markets traded with modest gains, as investors continue to remain wary over the Fed’s outlook on normalization. Meanwhile, the yellow metal remained on the back foot near $ 1330 levels amid higher Treasury yields.

Main topics in Asia

NZ retail sales volumes were stronger than expected in Q4 - ANZ

Analysts at ANZ noted that the NZ retail sales volumes were stronger than expected in Q4, with retail discounting – especially across big-ticket items – continuing to have a key influence. 

ECB's Smets: Euro strength "point of attention" for ECB - Reuters

More comments being reported by Reuters from the European Central Bank's council member and Belgian central bank governor Jan Smets following a brief talk earlier with Bloomberg reporters.

Japan National Consumer Price Index (YoY) above forecasts (1.3%) in January: Actual (1.4%)

Trump policies to boost wages without inflation - US Treasury Secretary Mnuchin

Trump policies will push up wages but won't have a big impact on inflation said US Treasury Secretary Mnuchin, according to Bloomberg. 

Fitch affirms ratings of Australia's big 4 banks Ratings agency Fitch has affirmed the ratings of Australia's four major banks …

Theresa May reverses stances on EU migrants post-Brexit - The Times

Prime Minister Theresa May recently signaled a reversal on a key Brexit policy regarding the future of EU migrants within the UK during the Brexit transition period, as reported by The Times in London.

United States to hit North Korea with large package of new sanctions on Friday - Senior US Official

Key Focus ahead

Another busy session will mark the end of an eventful macro week, with the German final GDP release awaited pre-Europe open. Traders look forward to the Eurozone final CPI data and informal meeting of EU heads of State Council for fresh cues on the EUR trades while the BOE MOC member Ramsden’s speech will be closely eyed by the GBP markets.

Moving on, the main risk event for the NA session today remains the Canadian CPI releases while the FOMC member Dudley’s speech will also garner some attention ahead of the Fed’s bi-annual monetary policy report.

EUR/USD - Monetary pol divergence favors deeper correction

The European Central Bank (ECB) and the Federal Reserve (Fed) minutes released this week showed growing policy divergence between these central banks.

GBP/USD preparing to take another run at 1.4, but Brexit continues to weigh

GBP/USD is being weakened from within thanks to a recent decline in household spending, adding credence to recent fears that inflation has already begun eating away at consumer's ability to spend, as well as continued infighting with the UK's parliament …

Europe: Key events ahead - Barclays

The Barclays Research Team enlists the key events worth looking forward to in the European session today.

Canada’s Jan CPI: Core inflation to remain muted – Capital Economics

Analysts at Capital Economics offer a sneak peek on what to expect from today’s Canadian inflation report slated for release at 1330 GMT.

Key Events: 

GMT
Event
Vol.
Actual
Consensus
Previous
Monday, Feb 19
24h
 
 
24h
 
 
24h
 
 
Tuesday, Feb 20
24h
 
 
Friday, Feb 23
24h
 
 
07:00
 
2.9%
2.9%
07:00
 
0.6%
0.6%
07:00
 
2.3%
2.3%
10:00
 
1%
1%
10:00
 
-1.6%
0.4%
10:00
 
-1.5%
0.5%
10:00
 
1.3%
1.3%
12:00
 
 
13:30
 
 
0.1%
13:30
 
1.4%
1.9%
13:30
 
0.7%
-0.5%
13:30
 
1.2%
1.2%
13:30
 
0.4%
-0.4%
n/a
 
 
15:15
 
 
18:00
 
 
798
18:30
 
 
18:30
 
 
20:30
 
 
$175.6K
20:30
 
 
712.3K
20:30
 
 
$179K
20:30
 
 
£14.9K
20:30
 
 
¥-115.5K
20:30
 
 
€127.3K
20:30
 
 
$9.1K

 

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