• The dollar slipped on Monday, losing some of its recent momentum as U.S. bond yields sagged, although moves were tempered by caution ahead of Federal Reserve Chairman Jerome Powell’s first congressional testimony.
The dollar index, which measures the greenback against a basket of six major rivals, eased 0.1 percent to 89.775. It gained nearly 0.9 percent last week and pulled away from a three-year low near 88.25 set on Feb. 16.
Against the yen, the dollar eased 0.3 percent to 106.61 yen. There was talk of dollar-selling by Japanese exporters ahead of the month-end.
The euro firmed 0.1 percent to $1.2308, after falling 1 percent last week as market players turned cautious on the euro ahead of the Italian general election on March 4. A German Social Democrats’ poll of its members on joining another coalition government with Chancellor Angela Merkel’s conservatives is also due that day, two big political risk events for markets.
• Investor sentiment was helped by the Federal Reserve’s semiannual monetary-policy report to Congress released Friday, said Vishnu Varathan, a senior economist at Mizuho Bank in Singapore.
The report signaled that the Fed wasn’t worried about the volatility in financial markets earlier this month and remained on track to gradually raise interest rates.
This indicated to investors that the “game plan hasn’t changed substantially,” said Varathan.
• The market, which currently expects three rate hikes for 2018, sees an 84.5 percent chance the U.S. central bank will raise rates at its March meeting, according to the CME Group's FedWatch tool.
• The White House said any talks with North Korea must lead to an end to its nuclear program after senior officials from Pyongyang visiting South Korea said on Sunday their government was open to talks with the United States.
• Germany’s Christian Democrats (CDU) meet on Monday to approve a coalition deal with the Social Democrats (SPD), a move that will take their leader Angela Merkel a step closer to a fourth term as chancellor of Europe’s biggest economy.
• China’s manufacturing sector likely posted another month of relatively solid growth in February, despite long Lunar New Year holidays and a tough pollution crackdown which disrupted factory operations.
The official manufacturing Purchasing Managers’ Index (PMI)is expected to have dipped only slightly to 51.2 in February from January’s 51.3, according to a median forecast of 29 economists in a Reuters poll.
That would mark the 20th straight month of expansion for China’s manufacturers, and reinforce consensus views that the world’s second-largest economy will only see a modest slowdown in growth this year. The 50-mark divides expansion from contraction on a monthly basis.
• India’s economy grew at its fastest pace in a year in the October-December quarter as consumers, businesses and the government stepped up spending, a Reuters poll predicted.
Gross domestic product INGDPQ=ECI grew 6.9 percent in the October-December quarter from a year earlier, according to the poll of more than 35economists, taken over the past week.
If the data, due at 1200 GMT on Feb. 28, matches the consensus, the quarter will have the best growth rate in 2017.
In July-September, the economy grew 6.3 percent annually, a return to a faster growth trajectory after five consecutive quarters of slowdown.
• Oil prices steadied on Monday after hitting their highest level in nearly three weeks, supported by comments from top oil exporter Saudi Arabia that it would continue to curb shipments in line with the OPEC-led effort to cut global supplies.
U.S. West Texas Intermediate crude for April delivery was up 4 cents at $63.59 a barrel by 0804 GMT after rising 3 percent last week.
London Brent crude slipped 3 cents to $67.28 a barrel, after climbing almost 4 percent last week.
Reference: Reuters, CNBC
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