Headlines:
- Bond yields hold lower awaiting Powell
- Powell likely to caution that strong economy could lead to more rate hikes - Timiraos
- Aussie lower after RBA offers subtle change to policy guidance
- BOE's Mann: I think more needs to be done with rates
- ECB's de Cos: Core inflation to stay high in the short-term, then ease gradually
- Germany January industrial orders +1.0% vs -0.9% m/m expected
- UK February Halifax house prices +1.1% vs -0.3% m/m expected
- China's trade with Russia continues to surge in first two months of the year
Markets:
- USD leads, AUD lags on the day
- European equities slightly higher; S&P 500 futures up 0.1%
- US 10-year yields down 4.1 bps to 3.942%
- Gold down 0.3% to $1,840.87
- WTI crude down 0.7% to $79.90
- Bitcoin down 0.1% to $22,374
It was a rather quiet session in Europe today as markets are awaiting the testimony (or at least the text release) of Fed chair Powell later today.
Bond yields are seen pushing lower, as they did at the start of yesterday, while equities are mostly steady on the session. But until we get to Powell, these moves can be classified as being rather tentative.
Meanwhile, the dollar is seen keeping slightly higher but the gains aren't anything to shout about. EUR/USD is down 0.2% to 1.0655 while GBP/USD is down 0.3% to 1.1990 on the day. USD/JPY is up slightly by 0.1% to 136.10, wrestling past the correlation with Treasury yields - at least for now.
The aussie is the main mover though, as it fell to over two-month lows against the dollar after the RBA's less hawkish policy stance. AUD/USD was hovering around short-term support at 0.6700 in the handover from Asia before falling to 0.6660 in European morning trade.
Well, over to you now Mr. Fed chair.
