- The U.S. economy unexpectedly expanded at a faster pace in the fourth quarter than initially estimated, reflecting a higher value of business inventories. Gross domestic product, the value of all goods and services produced, grew at a 1 percent annualized rate, compared with an initial estimate of 0.7 percent, Commerce Department figures showed Friday in Washington.
Consumer spending rose solidly in January and underlying inflation picked up by the most in four years. Gross domestic product growth in the fourth quarter was revised higher, to a 1.0 percent annual rate
The figures prompted Federal funds rate futures to price in a more than 50 percent chance of one rate hike by the end of year, compared to almost zero percent chance in mid-February.
- The two-year U.S. Treasuries yield US2YT=RR also hit a four-week high of 0.817 percent on Friday and last stood at 0.801 percent versus its Feb 11 low of 0.582 percent.
The greenback's yield allure helped lift the dollar's index against a basket of six major currencies .DXY =USD to a three-week high of 98.26 on Friday. It last stood at 98.13.
As the dollar gained, the euro EUR= fetched $1.0920, having slipped to a three-week low of $1.0912 on Friday. In early Asia on Monday, it traded at $1.0931, flat on the day.
The yen JPY= also slipped to one-week low of 114 to the dollar on Friday but bounced back 0.2 percent on Monday to 113.75.
Fears of "Brexit" offered traders a good excuse to sell the British pound, which fell to a seven-year low of $1.3854 GBP=D4.
Although the British government managed to get G20 to agree to include a warning against "Brexit" in the statement, that appeared to have limited impact, with sterling trading slightly weaker at $1.3861.
- G20 finance ministers and central bankers agreed to use "all policy tools – monetary, fiscal and structural – individually and collectively" to reach the group's economic goals, citing a series of risks to world growth.
Some market players say the statement could mildly underpin market sentiment, but the lack of any concrete action plans provided for few catalysts.
- Japan's industrial output rose the most in a year in January, tentatively signaling a pick-up in factory activity, but the outlook remains far from assured given global market jitters and weakening demand both at home and abroad.
The 3.7 percent month-on-month gain compared with economists' median estimate of a 3.3 percent gain in a Reuters poll, and followed a 1.7 percent drop in December, trade ministry data showed.
- Crude futures rose in early trading on Monday after gaining over 15 percent last week, with some indicators pointing to the possibility the market is showing signs of bottoming out.
International Brent futures LCOc1 had climbed around half a dollar, or 1.4 percent, from their last close to $35.58 per barrel at 8.41 p.m. ET on Monday.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 18 cents at $32.96 a barrel after gaining over 15 percent the previous week.
Analysts said that first signs of a strengthening market outlook were appearing after a 20-month rout that has seen prices fall by 70 percent.
Reference: Bloomberg, Reuters
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