Fed Chair Jerome Powell will testify today at 19:05 MT time. This event is crucial for traders as the tone of the speech may set the risk tone for the markets for the next two weeks.
Euro zone inflation drop might back cautious Draghi
This month euro zone inflation dipped, probably vindicating ECB President Mario Draghi's cautious policy stance and also proving that the EU bloc might still be years away from a sustained ascend in consumer prices.
In March, inflation in the 19-member currency union sagged to 1.5% from a four-year peak of 2% in February, quite below hopes for 1.8% as energy, services and food prices grew slower than the previous month.
Underlying inflation, a measure closely monitored by the ECB, headed south to 0.7% from 0.9%, thus erasing pressure on Mario Draghi to tighten the ECB's money taps in the nearer future.
When the previous month overall inflation reached the ECB's objective, conservative countries such as Germany applied pressure on Draghi, calling for an end to the ECB’s 2.3 trillion euro asset buying scheme.
However, the ECB rejected those calls, pointing out that inflation has already peaked in 2017 and it won’t get back toward its 2% objective.
Non-farm payrolls, the most awaited economic report, will be out on March 5 at 15:30 MT time.
Australian GDP rose by 3.1%, exceeding analysts’ forecasts of 2.5%. The Australian dollar climbed after the release, but then joined its peers in falling against the USD.
Great news for oil bulls! OPEC and its allied producers agreed to expand output cuts for the next month.
The USD skyrocketed after Fed Powell’s speech. OPEC and allied producers agreed to extend production cuts for another month. Oil surged.
The European Central Bank publishes its monetary policy statement that includes an announcement of the interest rate on March 11, at 14:45 MT time.