Fedspeak & Russian Invasion In Focus

The familiar themes of cautious Fedspeak on policy tightening and the ongoing war in Ukraine remained front and centre in Asia. Risk sentiment got some reprieve as Fed Chair Powell expressed support for a measured, quarter-point rate hike in March, but continued geopolitical turmoil in Eastern Europe kept fuelling concerns about energy supply.

• Scandinavian FX came under pressure amid regional contagion risk. Press reports suggested that the Kremlin has asked Finland and Sweden for security guarantees amid their increasingly assertive military posture and growing alignment with NATO.
• The AUD and CAD gained in tandem with most regional equity indices and crude oil prices. Meanwhile, USD and CHF drew support from continued geopolitical jitters in Europe.
• EUR/GBP went offered, slid through the 2020 low and printed its worst levels since late Dec 2019.
• Spot USD/CNH has held a tight range, edging away from session highs after a slightly weaker than expected PBOC fix. China's central bank set the USD/CNY reference rate at CNY6.3016, 19 pips above sell-side estimate.
• U.S. durable goods orders, factory orders & weekly jobless claims, EZ unemployment & Services PMI readings from across the globe take focus from here.
• Central bank speaker slate features Fed's Powell, Williams & Barkin, BoC's Macklem, ECB's de Cos & Riksbank's Skingsley. The ECB will publish the minutes from last month's policy meeting.