Japanese Finance Minister Aso is said to be planning to skip G20. (Kyodo)
Note: This comes amid earlier reports that Aso is under pressure to resign over a report regarding alleged favours to a school with connections to Japanese PM Abe’s wife.

Japan’s GDP rose 0.4% M/M in January according to data from JCER. (Nikkei)

New Zealand Food Price Index (Feb) M/M -0.5% (Prev. 1.2%). (Newswires)


UK Junior Brexit Minister Walker says very close to deal in regards to Brexit implementation period. (Newswires)

ITV’s Robert Peston reports UK PM May is poised to concede to the EU’s demand that the transition to full exit from the implementation period will end on December 21st 2020, which a few months early than she had initially hoped. (Newswires)



Euro zone creditors are to release new loans to Greece this month and are working on debt relief. (Newswires)

ECB’s Smets said Euro Zone inflation may take longer to reach ECB objective as output gap could take longer to close than anticipated, while he added that FX volatility is still as much in focus as before. (Newswires)

US President Trump tweeted that Secretary of Commerce Ross is to speak with the EU to discuss eliminating unfair tariffs against the US. (Newswires)

EU Commissioner Moscovici noted the EU must be ready for trade counter measures and French Finance Minister Le Maire said EU reaction to US on trade must be strong and united, while there were also reports that Russia is to implement measures in response to US steel tariffs. (Newswires)


USD trades negative heading into APAC trade, with the 90.0 figure failing to hold. Attention remains on Trade War related news flow; EU policy makers have responded to Trump’s weekend tweets, and are said to be preparing counter-measures to any tariffs imposed. USD traded as low as 89.84.

EUR continued clawing-back losses seen in aftermath of ECB’s meeting last week, 1.23 has been a level in focus. The single currency trades above this figure as EU policy makers talk up a possible response to trumps tariffs.

JPY maintained low following reports of cronyism from Abe, trading within range through EU and US trade is eyeing the 106.20 mark, a level traders have been watching.

GBP was trading flat in European trade around the 1.3860, however, was lifted after news that the UK is close on Brexit implementation period with the EU, boosting cable to 1.39, and trading henceforth within a narrow range of 1.3880 and just above 1.3900.


Oil futures began the week on the back foot. Crude stocks are seen building this week, with the median looking for +1.5mln, and Cushing +320k (according to Genscape). Products are once again seen drawing, the street forecasting distillate draw of 1.4mln, and gasoline draw of 2.1mln. Attention is also on this week’s OPEC and IEA monthly reports, which are expected to build on the theme of record US output. US crude production levels continue to scale record highs, and last week’s EIA STEO showed no signs of this trend abating (production forecasts revised up, demand forecasts were revised down). On this note, today the EIA reported that April shale output is likely to accelerate, forecasting a +131k BPD at 6.954mln vs. March’s +105k BPD. In terms of positioning, the latest CFTC commitment of traders data shows WTI longs cut by ~17k contracts — still at a healthy 479k — in the week (to 6/Mar), as longs were slightly pared, but shorts jumped; some desks warn that more negative oil data could compel further spec longs to close out their positions.

Workers at Libya’s Zawiya oil port are said to halt loadings despite earlier reports of negotiations taking place to end strike action at Zawiya. (Newswires)


North Korea Leader Kim reportedly wants to sign a peace treaty with the US and establish diplomatic relations, including a US embassy in Pyongyang. (Newswires)


US President Trump said he is very serious on part 2 of tax reform. (Newswires)

Sources report that conservative commentator Kudlow has emerged as a strong contender to be Gary Cohn’s replacement. (Newswires)

Canadian PM Trudeau said Canada will continue to press the US to gain a permanent exemption to the tariffs and that Canada will have to see what needs to be done if the US imposes tariffs. Furthermore, Canada PM Trudeau commented that they were never willing to walk away from NAFTA talks. (Newswires)


US indices start the week mixed, with industrials bearing the brunt of tariff related follow through, being down 1.1% on the day. Stocks found some support in afternoon trade, on reports that Larry Kudlow – a proponent of free trade – may replace Cohn. Tech-focused Nasdaq was up being the highest preforming index following Micron’s (MO) upgrading at Nomura, and Oclaro’s jump after Lumentum (LITE) would acquire them for USD 1.7bln. SPX -0.13% at 2783, DJI -0.62% 25178, NDX +0.42% at 7131.

Action was subdued on Monday, and volume was thin. In overnight trade, the curve had bear steepened amid a constructive risk environment. However, gains were seen through European and US trade, despite a healthy slate of corporate issuance. US T-note futures settled 6 ticks higher at 120-27.