Markets in Europe and North America held steady for the most part on Monday. News flow was relatively light with traders digesting G-20 finance ministers dropping comments related to avoiding protectionism, and waiting for the US House vote on health care reform due later this week.
Fed members are back out on the speaking circuit this week. Today regional Fed Presidents Harker and Evans indicated their continued support for rate hikes. With the street reacting dovishly to last week’s Fed statement and dot plot, FOMC members may look to recalibrate back to a more hawkish tone this week.
The main event of the day was the announcement that the UK government plans to trigger Article 50 to start the formal Brexit process on Wednesday March 29th. EU President Tusk indicated the EU plans to issue its initial response within 48 hours of the Article 50 notice from the UK. GBP gave back early gains on the news indicating traders had been hoping to the trigger to come this week. UK markets may be active Tuesday around UK inflation figures in the wake of last week’s Bank of England meeting which saw one MPC member vote for a rate hike on inflation concerns.
It’s a light day for Asia Pacific news but SGD, NZD, AUD and JPY have been gaining so we could see some activity in currency markets. Energy may also be active amid talk that OPEC cuts could be delayed and that Russia may be starting to keep some of its production cut promises. WTI crude fell 0.8% but gasoline rallied 2.1% on the day while natural gas was up 4.1%.
There have been no major announcements after the US close today.
Significant announcements released overnight include:
UK Rightmove house prices 2.3% unchanged
Germany producer prices 3.1% vs previous 2.4%
Upcoming significant economic announcements include:
(Note: 11:30 am in Sydney/Melbourne is currently 1:30 pm in Auckland, 4:30 pm in Vancouver, 7:30 pm in Toronto/Montréal, 12:30 am in London and 8:30 am in Singapore)
9:30 am GMT UK consumer prices street 2.1% vs previous 1.8%
9:30 am GMT UK retail prices street 2.9% vs previous 2.6%
9:30 am GMT UK producer input prices street 20.0%
9:30 am GMT UK producer output prices street 3.7%
9:30 am GMT UK house prices
8:30 am EDT Canada retail sales street 1.0% vs previous (0.5%)
8:30 am EDT Canada retail ex auto street 1.2% vs previous (0.3%)
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