· US retail sales in the spotlight
Investors' focus on Tuesday will be on a raft of key economic indicators due out in the States.
They include readings for industrial production and retail sales in February, as well as for business inventories and import prices.
Across the Channel, finance ministers from the European Union's 27 states will meet to discuss the current situation and way forwards on tax given the challenges from digitalisation and the economic situation, said Barclays Research.
They will also discuss the economic situation and outlook in Europe in the wake of the Covid-19 pandemic.
· Dollar holds firm in cautious trading before Fed meets
The U.S. dollar clung to small gains on Tuesday as caution reigned in currency markets ahead of major central bank meetings, beginning with a two-day Federal Reserve gathering due to start later in the global day.
The greenback hovered just off its highest since June versus the yen and cemented a position around $1.19 per euro in muted trading.
The firmer tone for the dollar came despite a retreat in U.S. benchmark yields from the highest levels in more than a year ahead of the Fed meeting.
Expectations are running low for monetary policymakers to shift from their accommodative stance despite forecasts of rapid economic growth in the wake of an accelerating COVID-19 vaccine roll-out and a $1.9 trillion pandemic relief package.
Investors will pore over whatever the Fed has to say about the run-up in yields, which have risen on bets that economic growth and inflation could prompt a faster-than-expected normalisation of monetary policy.
“It’s a very pivotal meeting from that perspective,” said Mayank Mishra, an FX strategist at Standard Chartered Bank in Singapore.
“The other thing that is being awaited is any decision on the supplemental leverage ratio (SLR) exemption. We don’t expect any explicit push back on back-end yields, but an extension of the SLR can offer some relief to the market.”
The SLR exemption, a regulatory break that allows big banks to exclude reserve deposits and Treasuries from capital ratios, is due to expire on March 31.
The dollar was little changed at 109.170 yen after rising to a nine-month high of 109.365 on Monday. The Bank of Japan begins a two-day policy meeting on Thursday, along with an extensive policy review.
The euro was largely flat at $1.19330, languishing below $1.20 since March 5. Europe’s vaccine roll-out has been hampered by the suspension of AstraZeneca shots in Germany, France and other nations amid concerns about possible serious side effects.
Sterling fell about 0.2% to $1.3871 ahead of a Bank of England meeting on Thursday, where the central bank is expected to keep its benchmark interest rate at its historic low of 0.1% and its bond-buying programme unchanged.
The dollar’s index against six major currencies was flat at 91.798 after rising nearly 0.2% on Monday.
The Australian dollar, viewed widely as a liquid proxy for risk appetite, and the New Zealand dollar were little changed against the U.S. dollar. The commodity-linked currencies are on course to post their fourth straight quarterly gain as commodity prices rebound on bets of economic growth.
Bitcoin, meanwhile, slipped to $54,198.64 following its jump to a record $61,781.83 on Saturday.
· German COVID-19 cases are growing exponentially again: RKI
German coronavirus infections are spreading exponentially, up 20% in the last week, an expert at the Robert Koch Institute for infectious diseases said on Tuesday, adding that the risk of AstraZeneca’s vaccine was relatively low.
On Monday, the number of cases per 100,000 rose to 83, up from 79 on Sunday and 68 a week ago, and the RKI has warned that metric could reach 200 by the middle of next month.
Germany on Monday suspended use of AstraZeneca’s COVID-19 vaccine, making it the latest of several European countries to hit pause following reports of blood coagulation disorders in recipients.
· New coronavirus variant found in French region of Brittany: French government
A new coronavirus variant has been found in the French region of Brittany, said the French health ministry in a statement late on Monday, adding that initial analysis did not show this new variant to be more serious or transmissible than others.
The health ministry said the new variant had been found in a cluster of cases in a hospital centre in Lannion.
· Japan PM Suga receives COVID-19 vaccination ahead of Biden meeting in U.S.
Japanese Prime Minister Yoshihide Suga received his first dose of COVID-19 vaccine on Tuesday in preparation for a meeting with U.S. President Joe Biden next month, becoming the country’s first government official to be publicly inoculated.
· Thai PM gets first shot of AstraZeneca vaccine after safety scare
· Suspension of AstraZeneca shots is 'political decision': Italy's medicines regulator head
· WHO urges world not to halt vaccinations as AstraZeneca shot divides Europe
· Australia to continue using AstraZeneca COVID-19 vaccine despite Europe pause
· Venezuela will not authorise AstraZeneca COVID-19 vaccine due to 'effects on patients', VP says
· Roche launches COVID-19 variant test to help monitor mutations
Roche is launching a SARS-CoV-2 variant test to help monitor emerging coronavirus mutations, the Swiss pharmaceuticals group said on Tuesday. The test here runs on widely used high-throughput systems and is for research purposes only.
· Yellen to meet religious leaders, NGO group pushing for debt relief
U.S. Treasury Secretary Janet Yellen will meet on Tuesday with Jubilee USA Network, a non-profit group that advocates for debt relief for developing countries, and senior religious leaders from large U.S. Christian and Jewish faith groups.
The online meeting will focus on ways to increase resources to help poor and middle income countries contain the COVID-19 pandemic, permanent debt restructuring and climate change, said Eric LeCompte, executive director of Jubilee USA Network.
· U.S. tells China to improve ties with Australia: U.S. official
The Biden administration has told China that normalising relations with Australia is a precondition to Washington taking any substantial step towards improving relations with Beijing, a senior U.S. official said on Tuesday.
In an interview with The Sydney Morning Herald newspaper, the U.S. president’s Indo-Pacific coordinator, Kurt Campbell, said China’s “economic coercion” of Australia had been raised in every meeting between U.S. and Chinese officials and “will be underscored in interactions in Anchorage later this week”.
U.S. Secretary of State Antony Blinken will meet with China’s top diplomat Yang Jiechi and State Councillor Wang Yi on March 18 in Alaska, the first high-level in-person contact between the two countries under the Biden administration.
Campbell said Biden had told Australia’s Prime Minister Scott Morrison “that we stood together on this” during the meeting of the Quad group of leaders, which also included Japan and India, on Friday.
· BOJ must prepare 'thoroughly' on digital currency, says Kuroda
Bank of Japan Governor Haruhiko Kuroda on Tuesday stressed the need for the central bank to “prepare thoroughly” for the time it may need to issue its own digital currency.
The BOJ will begin experiments on a central bank digital currency (CBDC) in spring 2021, Kuroda said, signaling its resolve to stay in line with other central banks that are stepping up the pace of development.
While the BOJ currently has no plan to issue CBDC, central banks must not wait idly until the need to roll out its own digital currency arises, he told a seminar.
· Japan to hike tariffs on U.S. beef as FY imports near limit: Kyodo
Japan is set to temporarily impose higher tariffs on U.S. beef, with imports for the fiscal year ending this month expected to exceed the maximum amount set under the Japan-U.S. trade agreement that took effect last year, Kyodo News reported.
· Japan's defence minister to discuss China's activities with U.S. counterpart
Japan’s defence minister, Nobuo Kishi, looks forward to discussing with his U.S. counterpart aspects of China’s activities in the East and South China Sea regions, he said on Tuesday.
· Japan, U.S. share serious concerns over tensions in South China Sea: Kishi
· Germany bets U.S. will make the best of 'bad deal' Nord Stream gas link
Germany is betting the U.S. administration will take a pragmatic approach to the Nord Stream 2 project to ship Russian gas to Europe and is pushing for the pipeline’s completion in defiance of U.S. opposition, officials and diplomats said.
· Funerals for slain Myanmar activists as violence escalates
The families of dozens of people killed in clashes between Myanmar security forces and anti-coup protesters prepared to hold funerals on Tuesday after candle-lit vigils overnight in defiance of a curfew.
· 'Troubling' signs of Myanmar food price rises since coup: U.N. agency
Reference: CNBC, Reuters, Share Cast
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