| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 02:00 | China | Industrial Production y/y | February | 6.8% | 5.0% | 7% |
| 02:00 | China | Retail Sales y/y | February | 7.4% | 5.2% | 5.5% |
| 02:00 | China | Fixed Asset Investment | February | 3% | 3.2% | 4.2% |
During today's Asian trading, the US dollar consolidated against major currencies, as market participants are cautious ahead of multiple Central Bank meetings.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) fell by 0.02% to 103.41. Although economists do not expect the Fed to make changes to policy parameters following the March meeting, the latest inflation data has forced investors to reconsider their expectations regarding the timing of the Fed's interest rate cut. Against this background, the focus will be on the Fed's interest rate forecasts. In December, Fed policymakers predicted that by the end of 2024, the rate would be cut by 0.75% or three times by 0.25%. According to experts, the risks are skewed to the Fed's median 'dot plot' forecast showing less easing than in December which would likely be dollar positive. According to the CME FedWatch Tool, markets see a 5.5% probability of a 25 basis point rate cut at the Fed meeting in May, and a 58.4% probability of a rate cut in June (compared to 73.3% last Friday), with 72 basis points of cuts priced in for this year.
The yen fell by 0.1% against the US dollar as investors corrected positions ahead of the Bank of Japan meeting. Larger-than-expected wage increases by large Japanese firms have reinforced expectations that the Central Bank may announce the cancellation of its negative interest rate policy tomorrow. However, there is still a possibility that the Bank of Japan may wait until the April meeting - now the markets estimate a 39% probability that tomorrow the Central Bank will raise the discount rate to 0.0% from -0.1%.