Euro area PMI figures for March are on the agenda today

Suddenly, all eyes are on FX in the market this week as dollar and yen strength are keeping a more risk averse tone with the former in particular starting to take a crack at key levels across the board – which may feed into softer tones elsewhere.

Oil’s plunge yesterday also didn’t help with the mood as US equities turned tail later in the session and the more defensive posture is being maintained in Asia today.

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The only comfort investors can take is that Treasury yields are continuing to nudge lower but even that might be in part due to haven/safety flows, so it’s not all positive.

US futures are keeping the calm for now, with S&P 500 futures and Dow futures near flat levels while Nasdaq futures are up 0.3%. But given the more tepid sentiment this week, that could easily switch up if the dollar pushes the agenda further later today.

CFTC positioning last week highlighted that leveraged funds have shifted to being long dollar instead now and we’re already seeing institutional calls turn in favour of the greenback as well – notably BofA and Barclays. Will there be more to follow?

0700 GMT – UK February CPI figures

0700 GMT – UK February PPI figures

Prior release can be found here. Much like everywhere else, there is a slight tilt towards an uptick in inflation pressures in the UK on base effects. But the question will be whether or not this will be sustained through to next year, though the general increase should be more evident in the latter stages of 1H 2021.

0815 GMT – France March flash manufacturing, services, composite PMI

0830 GMT – Germany March flash manufacturing, services, composite PMI

0900 GMT – Eurozone March flash manufacturing, services, composite PMI

The readings are expected to show little change across the region, as overall economic conditions are little changed as compared to February. Tighter restrictions are still in place for the most part and that is likely to keep a lid on any major improvement in business activity, which should reaffirm a double dip recession in the Eurozone.

0930 GMT – UK March flash manufacturing, services, composite PMI

Prior release can be found here (services, manufacturing). UK business activity is expected to improve a little, with services in particular likely to reflect slightly better conditions despite tighter restrictions still being maintained for the most part. It is still all about the outlook going into 2H 2021 as the vaccine rollout gathers pace in the UK.

1100 GMT – US MBA mortgage applications  w.e. 19 March

Weekly US housing data, measures the change in number of applications for mortgages backed by the MBA during the week. Amid the sudden turn higher rates this year, recent mortgage activity has dipped with purchases falling sharply alongside refinancing activity so it’ll be one to watch out for.

That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.

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