Forex Today: Kiwi strongest in Asia, BOE FSR, Carney speech in focus

A quiet Asian affair, with a mix of central bankers’ speeches dominating and driving the flows around the US dollar and Yen. As a result, the Japanese currency was the weakest, despite stalled US dollar recovery across its main competitors. Meanwhile, the Kiwi emerged the top gainer amid a position-related short squeeze.

Among other related markets, the Asian equities extended losses and moved away from decade highs, as China stocks weakness continued to weigh. Oil prices dropped on Keystone pipeline restart news, while gold prices traded on the back foot ahead of the Fed Chair nominee Powell’s testimony.

Main topics in Asia

Fed’s Powell: Fed expects interest rates to rise ‘somewhat further’

Fed’s Powell pledges "to respond decisively" to any new economic threats, cites need to retain "flexibility" in setting policy.

Fed’s Kashkari: would like the Fed to hold off on tightening until inflation was above 2%

Fed’s Kashkari is speaking on a panel at Winona State University's Town Hall Forum, in Minnesota. Fed’s Kashkari is a voting member and a dove.

BoJ Kuroda: ‘Don’t see easy monetary policy hurting Japan’s financial system so far’

Headlines crossing the wires again from the BoJ Governor Kuroda, as he speaking in Parliament alongside the Japanese PM Abe.

Fed's Dudley - US economy doesn't need tax stimulus

More comments from Fed's Dudley are crossing the wires via LiveSquawk…

New London office construction slows on Brexit jitters: Deloitte survey

According to the latest London Office Crane Survey, conducted by Deloitte Real Estate showed that the number of new office construction in London is falling.

Seoul, Washington monitoring possible N. Korea missile test - Yonhap

South Korea’s Yonhap news agency reported comments from the South Korean Army Col. Roh Jae-cheon, the spokesman of the Joints Chiefs of Staff, noting that South Korea and the United States are closely watching the possibility of North Korea resuming provocative acts.

Key Focus ahead

Heading into Europe, investors brace for the German import prices data, BOE’s bank stress test results and FPC statement release, which will be followed by BOE Governor Carney’s speech at a press conference about the Financial Stability Report and Bank Stress Test Results. From the Euroland, Eurozone money supply data and German Gfk consumer climate will be reported.

Moving on, the NA session remains quite eventful, with the Canadian RMPI and US goods trade balance due on the cards ahead of Fedspeaks, with Powell’s Congressional address the key focus. Also, of note remains the US consumer confidence data, BOC Governor Poloz speech and RBNZ Financial Stability Report (FSR) slated for release later in the American mid-morning.

GBP/USD: Will the buyers retain control ahead of BOE’s FSR, Carney speech?

Fresh bids emerged at the hourly 100-SMA support of 1.3310 in early trades that allowed a tepid-recovery in the GBP/USD pair, as attention shifts towards the BOE Financial Stability Report (FSR) and Governor Carney’s speech due later today.

EUR/USD risk reversals contradict bearish pinbar, still gunning for 1.20?

Euro's drop from the previous day's high of 1.1975 to 1.1898 cannot be attributed to specific factor(s) but could be considered as a sign of bull market exhaustion. 

TransCanada to restart Keystone pipeline on Tuesday, WTI set to fall further?

Calgary-based TransCanada Corp came out with a brief statement on Tuesday, via Reuters, noting that the Keystone crude oil pipeline that carries oil to the US refineries will restart at reduced pressure from today.

FX - Central Bank Speak to Tax Reform, Here's What to Watch

The Bank of England publishes its twice a year Financial Stability Review tomorrow and the release will be followed by a presentation by Governor Mark Carney who will share his recommendations for the banking sector.