Funda and political wrap for US session: Draghi's usual cautious script weighed on EUR/USD

From a fundamental perspective today, most market moves didn’t seem obviously linked to data or events on Monday. However, the euro was heavy on ECB's president Draghi speaking early in the US session at the European Parliament and sticking to his cautious script, saying that inflation had yet to show a sustained uptrend.

The euro made a session low of 1.2277 but soon turnaround finding space back on the 1.23 handle in a combination of the dollar weakening off (stronger US stocks) and an upbeat assessment of the euro economy from Draghi who said that growth is stronger than previously expected and noting the improvement in labour markets. 

Meanwhile, traders are waiting for Fed Powell´s testimony before the Congress on the Semiannual Monetary Policy Report tomorrow. But for today, the following are some of the key headlines in Monday's political and economic developments:

(Source: Live Squawk headlines)

Politics: / Brexit

• UK Junior Trade Minister Stuart: Govt is committed to keeping data flowing post-Brexit - RTRS
• UK Junior Trade Minister Stuart: Will ensure tech firms can continue to recruit talent post-Brexit
• Moody's Brexit monitor: surveys suggest UK economic growth may have eased in early 2018.
• UK PM May, in phone call with Japanese PM Abe: reaffirms govt commitment to ensuring UK remains welcoming to Japanese companies

Politics: / US trade & NAFTA headlines

• EU’s Envoy to us O’Sullivan: US will not renegotiate Iran nuclear deal: shares Trump concern over China aluminium & steel EU’s Envoy to us O’Sullivan: US punishing EU steel companies would be ‘unfair’
• US Pres. Trump: if it takes tariffs to bring steel industry back, ‘so be it’ - RTRS
• Mexican, Canadian officials: negotiators seek new schedule for Mexico NAFTA sessions on regional content rules for autos
• Mexican, Canadian officials: seeking new schedule after us negotiator returned to Washington for consultations
• US Treas Sec Mnuchin: Treasury’s top focus is the implementation of the tax law

Politics: new leadership appointments

• Australia's national party elects Michael McCormack as new leader, becomes country's deputy prime minister - RTRS
• S.African Pres. Ramaphosa: Mabuza named as deputy president
• S.African Pres. Ramaphosa: Radebe named as energy minister
• S.African Pres. Ramaphosa: Sisulu named as foreign minister

US Data:

• Dallas FED manufacturing business index Feb: 37.2 (est 30; prev 33.4)
• US New Home Sales Jan: 593k (est 648k; prev r 643k)
• New Home Sales (m/m) jan: -7.8% (est 3.6%; prev r -7.6%)

Central Banks:

• ECB's Draghi: denies that there is a currency war

• ECB' Draghi: Inflation path still conditional on ECB stimulus.

• St. Louis Fed president Bullard remained a lot more dovish than his colleagues, saying he is concerned the fed is moving too far, too fast on interest rates. He did concede that the economy is looking very good.
• Fed's Bullard: 'substantially' higher rates risk overly tight policy
• Fed’s Quarles: sees further gradual rate hikes as ‘appropriate’
• Fed’s Quarles: Fed to be ‘very focused’ on meeting dual mandate
• Fed’s Quarles: 2% inflation target is not a cap, target is symmetric

• Fed’s Quarles: sees further gradual rate hikes as ‘appropriate’

• No comments on economy, monetary policy in BoE Cunliffe's prepared remarks