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Despite the risk-off action in the Asian equity markets, the higher-yielding currencies – the Kiwi and the pound emerged the top performers in the Asian session this Friday. The Cable managed to keep its recovery mode intact after the European Union (EU) agreed to give May two weeks’ Brexit extension. The Kiwi rallied likely on repositioning ahead of the RBNZ monetary policy decision next week.  Meanwhile, the Aussie stalled its recovery and fell back in the red near 0.7100 levels amid fresh worries over China anti-dumping duties and the US sanctions on North Korea. The safe-haven Yen benefited from risk-aversion, having limited the USD/JPY post-FOMC recovery near 110.90 region.

On the commodities front, both crude benchmarks traded modestly flat, with bias leaning towards the downside while gold prices on Comex consolidated the previous drop below the 1310 level amid negative Treasury yields and US dollar.

Main Topics in Asia

On Brexit

Brexit summit EU leaders could agree two-tier approach to Brexit delay – RTRS citing diplomatic sources

EU’s Tusk: unanimously agrees on it’s response to UK’s requests

EU’s Tusk: if UK has not decided by April 12th, long extension will become impossible

EU’s Juncker: long extension would be until the very end

UK PM May welcomes council approval of assurances on backstop

Other Headlines

US imposes first new North Korea sanctions since failed Hanoi summit – Reuters

North Korea demands the US to remove weapons from Guam and Hawaii – Dong-A Ilbo

Gold Technical Analysis: Demand ahead of rising channel support leaves bias neutral/bullish

China to impose temporary antidumping measures on some products

WTI Technical Analysis: Rising wedge potential scenarios

Asian stocks remain subdued amid Brexit, trade worries

Key Focus Ahead

Today’s EUR macro calendar remains a busy one, with a raft of Euro area flash manufacturing and services PMI releases dropping in from 0815 GMT onwards. Among them, the French, German and the entire bloc’s reports will be closely eyed for a fresh take on the Eurozone’s economic health. Also, of note remains the Eurozone current account data that will be reported at 0900 GMT. The speeches by the ECB Governing Council members De Guindos and Mersch will also grab attention at 0815 GMT and 1015 GMT respectively. At 1200 GMT, the GBP traders will await the BOE quarterly economic bulletin while the Brexit-related development will continue to drive the sentiment around the pound.

The NA session also has plenty of event risks to offer, including the Canadian retail sales and CPI figures slated for release at 1230 GMT, followed by Markit flash manufacturing and services PMI readings due at 1345 GMT. At 1400 GMT, the US existing homes sales data will be published alongside the wholesale inventories report. Next of relevance remains the Baker Hughes US oil rigs count data that will drop in at 1700 GMT, an hour ahead of the US monthly budget statement release.

EUR/USD looks to regain 1.1400 ahead of Eurozone PMIs

The EUR lacks the recovery momentum, as the bulls turn cautious heading into the flash manufacturing and services PMI releases from across the Euro area economies due later on from 0815 GMT onwards.  

GBP/USD: Recovery underway towards 1.3190/1.3260, Brexit developments in spotlight

The  GBP/USD  pair has been on a recovery mode since Thursday-end as EU leaders finally agreed over the  Brexit  deadline extension with the two-factor system giving unconditional stretch till April 12. Though, uncertainty over the Brexit still remains on cards “¦  

EMU Purchasing Managers’ Indexes: Trend intact

The manufacturing PMI is projected to rise to 49.5in March from 49.3. The service sector PMI is predicted to drop to 52.7 from 52.8 in February. The composite index will  gain 52.0 from 51.9.  The EMU economy has been slowing for more than a year.  

Dollar U-Turns, GBP Crashes Will the Reversal Last?

 We’re looking at the strong possibility of an emergency EU summit next week that will prolong the uncertainty and take  GBP/USD  well below 1.30.

Canada: Headline CPI to rise 0.4% m/m in February – Barclays

The Barclays Research Team offers a sneak peek at what to expect from Friday’s Canadian inflation report due on the cards at 1230 GMT.