Forex Today: USD bounces alongside T-yields in Asia; UK politics/ Brexit in focus

Broad-based US dollar recovery was the main underlying theme that triggered a fresh selling-wave across the fx board in Asia this Thursday. The rebound in the greenback was mainly driven by a recovery in Treasury yields across the curve while the extension of the corrective slide in GBP/USD from the 2019 tops also added to the uptick in the buck. Markets resorted to profit taking on the GBP longs heading into the vote on Article 50 extension later today. The Euro tracked the correction in the Cable and marched towards the 1.13 handle.

Among the Asia-pac currencies, the Aussie was the biggest loser and headed for a test of the 0.7050 support following mixed Chinese data dump, followed by the Yen and the NZD. The USD/JPY pair clinched for-day tops at 111.61 on reports of Japanese growth downgrade while the Kiwi returned below 0.6850 levels.

On the related markets front, the Asian equities traded mixed, led by the declines in the Chinese stocks while both crude benchmarks traded modestly flat, with WTI having eased-off multi-months near 58.50 levels. Gold futures on Comex slipped and edged back towards the 1300 levels.

Main Topics in Asia

US Pres. Trump: In no rush to complete China trade deal - Reuters

Gold Technical Analysis: Rejected at 4H 200MA, hourly RSI diverges in favor of bears

Japanese Govt considering a slight downgrade in its monthly report for March - Nikkei

UK Press: PM May is preparing a third meaningful vote on Brexit on March 20

China Jan-Feb data dump: Retail sales rise 8.2%, industrial output drop 5.3%

China NBS: China's economic growth in Jan-Feb within reasonable range

Tapering? BOJ's ETF purchases hits lowest since 2016

Sources: US aims to cut Iran oil exports to under 1 million bpd from May - Reuters

Ex-National Economic Council Head Cohn: US desperate to sign trade deal with China

Key Focus Ahead

Markets remain focused on the Brexit-related developments amid a no deal Brexit rejected by the UK lawmakers and the Brexit extension of 2 months seeming the most likely bet, as rumor mills talk of the third meaningful vote on the UK PM May’s Brexit deal next week. Meanwhile, the EUR calendar remains a thin-showing, with the German final CPI release dropping in at 0700 GMT, following the Swiss producers and import prices at 0730 GMT.

In the NA session, the US weekly jobless claims, import prices and the Canadian new housing price index are due at 1230 GMT. At 1400 GMT, the US new home sales data will be eyed for fresh dollar trades. In the American afternoon, at 1900 GMT, the UK parliamentary vote on Article 50 extension is scheduled while New Zealand’s business PMI and visitors arrivals data will be published at 2130 GMT and 2145 GMT respectively.

EUR/USD has reversed last week's post-ECB sell-off, whats next?

EUR/USD's drop to 21-month lows below 1.12 has been reversed, but the relief could be short-lived, as the US 10-year treasury yield has bounced up from three-month lows seen earlier this week. 

GBP/USD revisits sub-1.3300 area as UK MPs eye deadline extension

Investors may concentrate on how the UK members of parliament (MPs) can agree over delaying Article 50 deadline today. On the data front, initial jobless claims for the week ending on March 04 and January month new home sales are on cards.

GBP Soars 2% on Brexit Vote, 1.35 Next?

Having had years to reach an agreement, expectations for a 2 month extension are low but if May puts in the request and the EU accepts it (and there's no reason for them not to), GBPUSD could extend its rally to 1.35. 

WTI Technical Analysis: Ichimoku Cloud is bullish, double tops broken, eyes on $60.00bbls

The price is now testing the territory on the 58 handle, breaking the double-top highs. Bulls look to higher grounds while holding above the $57.93bbls and the horizontal prior resistance line going back to mid-Nov 2018.

GMT
Event
Vol.
Actual
Consensus
Previous
Monday, Mar 11
24h
 
 
Tuesday, Mar 12
24h
 
 
Thursday, Mar 14
06:45
 
 
07:00
 
0.5%
0.5%
07:00
 
1.7%
1.7%
07:00
 
1.6%
1.6%
07:00
 
0.5%
0.5%
07:30
 
 
-0.7%
07:30
 
 
-0.5%
n/a
 
 
12:30
 
225K
223K
12:30
 
1.775M
1.755M
12:30
 
0.1%
-0.6%
12:30
 
 
-1.7%
12:30
 
0.3%
-0.5%
12:30
 
 
-0.2%
12:30
 
0%
0%
12:30
 
0%
0%
14:00
 
0.620M
0.621M
14:00
 
-0.9%
3.7%
14:30
 
 
-149B
16:30
 
 
2.405%
19:00
 
 
21:30
 
 
53.1
21:45
 
 
3.1%
22:50
 
 
Friday, Mar 15
01:30
 
 
10%

 

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Editors’ Picks

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GBP/USD is holding above 1.3200 after Parliament approved holding indicative votes. The non-binding votes may put pressure on May to change tack on Brexit or may push Brexiteers to support her deal.

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USD/JPY sticks to modest gains above 110.00 handle, but lacks follow-through

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Editors’ Picks

EUR/USD stable around 1.1300 as markets look calmer

EUR/USD continues trading around 1.1300, marginally higher on the day. Markets are calmer after the sell-off and this helps the euro stabilize and it ignored weak German GfK consumer confidence. Brexit headlines are eyed.

EUR/USD News

GBP/USD moves up after Parliament takes control

GBP/USD is holding above 1.3200 after Parliament approved holding indicative votes. The non-binding votes may put pressure on May to change tack on Brexit or may push Brexiteers to support her deal.

GBP/USD News

USD/JPY sticks to modest gains above 110.00 handle, but lacks follow-through

The USD/JPY pair regained some positive traction on Tuesday, albeit continued with its struggle to build on the momentum further beyond the 110.25 region.

USD/JPY News

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Bond markets tend to give signals for the future. In the past, when the 3-month US Treasury yield became higher than the benchmark 10-year yield, it was an initial sign of a recession.

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The Consumer Confidence Index from the non-profit business group the Conference Board is projected to rise to 132.0 in March from 131.4 in February. 

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