· The safe-haven dollar and yen slid on Monday as risk appetite increased after U.S. President Donald Trump said he would delay a planned hike in tariffs on Chinese imports, suggesting trade negotiations between the two countries have made significant progress.
The U.S. deadline set earlier for imposing higher tariffs on Chinese goods was March 1.
In emerging markets, the South African rand led all gainers versus the greenback, rising 1.4 percent to 13.8495 rand per U.S. dollar.
In afternoon trading, the dollar index, which measures the currency's value against a basket of six currencies, fell 0.09 percent to 96.42.
The yen was also weaker, sliding to a two-month low verus the euro, which was last at 126.255 yen, up 0.7 percent. The Japanese currency also fell against the dollar, which last changed hands at 111.03 yen, up0.32 percent.
China's yuan, meanwhile, touched a seven-month high while Chinese equities surged as investors and European shares also performed well. The offshore yuan rose as high as 6.6737 per dollar to touch its strongest since mid-July and was up 0.3 percent at 6.68. China's yuan has strengthened 2.7 percent against the dollar in 2019, reversing some of last year's 5.5 percent loss.
The euro also gained against a weaker dollar, adding 0.16 percent to $1.1359, keeping it within recent trading ranges.
· The U.S. economy is in a “good spot” now, Federal Reserve Vice Chair Richard Clarida said on Monday, operating at near full employment and with inflation near the Fed’s 2-percent goal.
Since inflation is muted, the Fed “can be patient” on deciding where to set interest rates, Clarida told Dallas Fed President Robert Kaplan in an interview at the Dallas Fed’s headquarters before an audience that included local business leaders and several Fed policymakers.
· Federal Reserve Chairman Jerome Powell will face the Senate Banking Committee Tuesday to share his semiannual update on the state of the U.S. economy.
Federal Reserve Chairman Jerome Powell is likely to get a warm welcome from members of Congress this week for his switch to a dovish policy stance, economists said.
· “The testimony will be easier now that Powell is not threatening rate hikes,” said Avery Shenfeld, chief economist at CIBC Capital Markets.
A patient Fed is good news for members of Congress “who worry about having their reelections waylaid by growth slowdowns,” he noted.
· Joseph Song, senior U.S. economist at BofA Merrill Lynch Global Research, said he was interested in seeing if Powell says anything about what could lead the Fed to resume raising interest rates again.
· Britain's opposition Labour Party said on Monday it would back calls for a second referendum on Brexit if parliament rejects its alternative plan for leaving the European Union.
With just over a month until Britain is due to leave the bloc on March 29, Prime Minister Theresa May is seeking changes to her exit deal in order to break an impasse in parliament.
Labour's decision could damage her hopes of winning support for a revised deal in a vote she has promised by March 12, by attracting those who would have backed her agreement to avoid a no-deal exit but who prefer a second referendum.
· Prime Minister Theresa May said a timely exit for Britain from the European Union is “within our grasp” and insisted on Monday that delaying Brexit would be no way to solve the impasse in parliament over the departure.
Her comments came as the opposition Labour Party said it would support calls for a second referendum on Brexit, a potentially significant policy shift that could further damage May’s hopes of getting a divided parliament to approve her exit deal.
May said she wanted Brexit to happen as planned on March 29 and shrugged off expectations that she will be forced to delay to avoid leaving the EU in a disorderly way without an agreement.
· Sterling jumped to a four-week high against the dollar late on Monday after Bloomberg News reported British Prime Minister Theresa May was considering delaying a deadline on Brexit.
The report said May is expected to allow her cabinet to discuss extending the deadline beyond March 29 at meeting on Tuesday.
The British pound rose to a four-week peak of $1.3153 , and was last up 0.2 percent at $1.3124.
· British Prime Minister Theresa May is considering a plan to delay Brexit to ensure the UK does not leave the European Union without a deal, Bloomberg reported here on Monday, citing people familiar with the situation.
May will propose that her cabinet discuss extending the March 29 deadline at a meeting on Tuesday, Bloomberg reported. May would announce the conclusions of the meeting to parliament later in the day, it said.
Seeking to delay Brexit would be a change of stance for the prime minister, who said on Monday it was no way to solve the impasse in parliament over the exit deal she has negotiated with Brussels.
The UK cannot extend the Brexit deadline unilaterally, however, and needs the European Union to sign on to the idea.
· Bank of Japan Governor Haruhiko Kuroda said on Tuesday he expected China’s economic growth to pick up in the latter half of this year thanks to stimulus measures taken by the government.
“China’s economy slowed quite significantly in the latter half of last year” as companies felt the pinch from Sino-U.S. trade tensions, Kuroda told parliament.
“The economy may remain in the doldrums in the first half of this year but will likely pick up thereafter, as authorities have taken fiscal and monetary stimulative action,” he said.
· Oil prices tumbled more than 3 percent on Monday after President Donald Trump publicly urged OPEC to lower the cost of crude, putting pressure on the Saudi-led group to soften its price-boosting output cuts.
"Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike - fragile!" the president said in an early morning tweet.
· The message comes two months into a fresh round of production cuts from OPEC and other nations. The producers meet in mid-April to review the deal, which is scheduled to last through the first six months of 2019.
U.S. West Texas Intermediate crude futures ended Monday's session down $1.78, or 3.1 percent, at $55.48 a barrel. On Friday, WTI hit a more than three-month intraday high at $57.81 a barrel.
International benchmark Brent crude futures fell $2.36, or 3.5 percent, at $64.76 a barrel. Brent hit $67.73 a barrel on Friday, its highest intraday level since mid-November.
· "Risk appetite across global markets should improve as President Trump extends the deadline of trade talks with China," Harry Tchilinguirian, global oil strategist at BNP Paribas in London, told the Reuters Global Oil Forum.
"Supply risk is ever present with Venezuelan tensions brewing a notch higher ... the National Oil Corporation in Libya refusing to start production at the El Sharara field," he added, while also citing uncertainty over elections in top African oil exporter Nigeria.
· U.S. sanctions on Iranian and Venezuelan crude plus involuntary curbs in Nigeria and Libya are lending support to efforts to balance the market and support prices, efforts led by member of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers such as Russia.
Reference: CNBC
Thai
Eng