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It was a relatively quiet session with Japanese traders out on holiday, so forex traders mostly prepared for the Fed and RBNZ’s statements.

The Loonie caught a nice boost, however, thanks to the U.S. softening its stance on some of Canada’s exports.

  • Japan’s markets out on a holiday
  • New Zealand’s credit card spending (y/y) up from 4.6% to 7.0% in February

Major Events/Reports:

Trump softens stance on auto content requirement

A report from Canada’s The Globe and Mail cited “sources with knowledge of the talks” and shared that Trump has dropped his demand for all the vehicles made in Canada and Mexico and for export to the U.S. contain at least 50% of materials from the U.S.

Washington has originally called for (a) raising the amount of NAFTA content in autos from 62.5% to 85% and (b) making sure 50% of the total comes from the U.S.

Canada and Mexico rejected the U.S. content demand, as it would give the U.S. a guaranteed economic advantage over its NAFTA partners.

The move signalled the administration’s willingness to compromise and make deals, which is a good sign for more NAFTA-related negotiations down the road.

All eyes on the Fed and RBNZ’s statements

Asian session trading was a mixed bag of nuts, as a lack of fresh catalysts led market players to continue pricing in news from the previous sessions while others took off their bets ahead of the much-awaited FOMC statement.

  • Nikkei is down by 0.47% to 21,381.0;
  • Australia’s A SX 200 is up by 0.12% to 5,952.8;
  • Hang Seng is up by 1.21% to 31,931.0, and
  • Shanghai index is up by 0.48% to 3,306.282.

Commodity prices were a little more mixed.

  • Gold is up by 0.22% to $1,314.04;
  • Brent crude oil is flat at $67.56, and
  • U.S. WTI is down by 0.08% to $63.66.

Major Market Mover(s):

USD
The Greenback was unable to maintain its bullish momentum from the previous session as some traders took profits ahead of today’s FOMC event.

USD/JPY is down by 5 pips (-0.05%) to 106.48;
USD/CHF is down by 15 pips (-0.16%) to .9549;
EUR/USD is up by 22 pips (+0.18%) to 1.2264, and
GBP/USD is up by 15 pips (+0.10%) to 1.4012.

NZD
The New Zealand dollar also lost pips across the board a few trading sessions before the RBNZ’s statement is released. If you recall, the central bank hasn’t been the most optimistic of central banks lately.

NZD/CHF is down by 12 pips (-0.17%) to .6859;
NZD/CAD is down by 35 pips (-0.37%) to .9354;
EUR/NZD is up by 36 pips (+0.21%) to 1.7074, and
GPB/NZD is up by 26 pips (+0.13%) to 1.9508.

CAD
The Loonie took home the maple bacon during the Asian session thanks to the NAFTA deal easing some concerns over Trump’s tough stance over Uncle Sam’s products.

USD/CAD is down by 47 pips (-0.36%) to 1.3024;
EUR/CAD is down by 29 pips (-0.18%) to 1.5972;
GBP/CAD is down by 48 pips (-0.26%) to 1.8248, and
CAD/JPY is up by 27 pips (+0.33%) to 81.76.

Watch Out For:

  • 9:30 am GMT: U.K.’s public sector net borrowing (-0.4B GBP expected, -11.6B GBP previous)
  • 9:30 am GMT: U.K.’s labor market numbers. Watch out for the unemployment rate, claimant count change, and average wage data.
  • 11:00 am GMT: U.K.s CBI industrial order expectations (9 expected, 10 previous)