• The euro edged higher on Monday after a short-lived sell-off tied to Italy’s inconclusive weekend election, helped by the creation of a coalition government in Germany that eased political uncertainty there.
The euro EUR= was last up 0.11 percent to $1.2330, erasing losses tied to the Italian election results.
The single currency rose to a two-week high at $1.2365 in Asian trading after the German results.
• Former Italian Prime Minister Matteo Renzi has resigned as leader of the centre-left Democratic Party (PD) after a bruising election defeat, but pledged that his party would not strike deals with the anti-establishment parties that voters favoured.
The anti-establishment 5-Star movement and the far-right Northern League could have enough support for a majority after Sunday’s (4 March) general election, although some analysts believe such a nightmare scenario coalition is unlikely.
According to a vote projection released by RAI state TV, based on votes counted as of 0230 GMT on Monday, the 5-Star movement could expect to get 216-236 seats in the 630-seat lower house.
A centre-right coalition was tipped to get 248-268 seats, including 122-132 seats for the far-right League and 94-104 seats for Forza Italia. In third place behind 5-Star and the centre-right bloc was a centre-left coalition dominated by the ruling Democratic Party (PD), on track to take 107-127seats.
The full result is not due for many hours and previous elections in Italy have seen wild swings as the count proceeds.
• A senior conservative lawmaker on Tuesday told Germany’s Social Democrats they would jeopardize a hard-fought coalition agreement if they went overboard with spending plans for Europe.
• The dollar rose versus the yen as traders reduced their safe-haven holdings of the Japanese currency on easing fears about a trade war stemming from U.S. President Donald Trump’s tariffs on imported steel and aluminum proposed last Thursday.
The dollar index, which tracks the greenback against a basket of currencies, was mostly steady at 90.080 at the end of Monday.
The dollar fetched 106.32 yen at 8:14 a.m. HK/SIN after falling as low as 105.34 in the overnight session.
• The top U.S. trade envoy said on Monday that bilateral deals could replace NAFTA if the pact is not renegotiated soon, ramping up pressure on Canada and Mexico, already smarting from President Donald Trump’s plan to impose steel and aluminum tariffs.
U.S. President Donald Trump’s proposed blanket tariffs on steel and aluminum imports are an “incentive” for Canada and Mexico to conclude a NAFTA trade deal with the United States, Trump’s trade envoy said on Monday after NAFTA negotiators ended the latest round of renegotiation talks.
• The chief regulator for the U.S. Federal Reserve said Monday the nation’s regulators are actively considering a significant rewrite of the “Volcker Rule.”
Fed Vice Chair for Supervision Randal Quarles told bankers gathered in Washington that regulators want to make “material changes” to streamline and simplify several aspects of the ban on certain bank trading, put in place after the 2007-2009 financial crisis.
• A South Korean delegation had a first-ever meeting with North Korean leader Kim Jong Un on Monday and they hoped to encourage Pyongyang and the United States to talk, officials said.
Both North Korea and the United States have expressed a willingness to hold talks, but the U.S. position has been that they must be aimed at North Korea’s denuclearization, something Pyongyang has rejected.
• North Korean leader Kim Jong Un told a visiting delegation from South Korea that it is his “firm will to vigorously advance” inter-Korean ties and “write a new history of national reunification,” the North’s official news agency said on Tuesday.
• Crude prices rose on Monday along with the U.S. stock market on forecasts for robust oil demand growth and concerns that output from OPEC producers would grow at a much slower pace in coming years.
Brent futures LCOc1 gained $1.17, or 1.8 percent, to settle at $65.54 a barrel, while U.S. West Texas Intermediate crude futures CLc1 gained $1.32, or 2.2 percent, to settle at $62.57.
Reference: Reuters, CNBC, Brisbane Times, Euractiv
Thai
Eng