US Dollar weakened mildly overnight as traders pared back bets on mid-year rate hike from Fed after FOMC minutes. The FOMC minutes for the January meeting appears more dovish than expected. Policymakers retained the "patient" language as some members were concerned that removal of which too soon would trigger the market to price in tightening too quickly. As mentioned in the minutes, "many participants indicated that their assessment of the balance of risks associated with the timing of the beginning of policy normalization had inclined them toward keeping the federal funds rate at its effective lower bound for a longer time". On the economic outlook, inflation forecast in the near-term was "revised down" due to "further sharp declines in crude oil prices since the December FOMC meeting". The Fed also noted that "the incoming data on consumer prices apart from those for energy showed a somewhat smaller rise than anticipated". The forecast for inflation in 2016 and 2017 was "essentially unchanged, with inflation projected to remain below the Committee's 2% objective". More in Fed Revised Lower Short-Term Inflation Forecast, Remained Patient On Tightening.
In Greece, a majority of 233 lawmakers in the 300 seat parliament voted for prime minister Alexis Tsipras's candidate Prokopis Pavlopoulos as the president of the country. ECB approved a EUR 3.3b expansions, totalling EUR 68.3b), to emergency funding for Greek banks after the governing council meeting in Frankfurt yesterday. It's reported the Greek government will submit a request to Eurozone for a six month loan extension today, a day later than originally planned. Earlier this week, after abrupt end in talks with Greece, Eurozone finance minister chair Jeroen Dijesselbloem gave Greece until Friday to request a extension to the bailout, which would otherwise expires on February 28. There are talks that Eurogroup will only approve the extension if Greece promise to carry on with the committed austerity measures and reforms.
Released from UK yesterday, the BOE minutes showed that the members voted unanimously to keep the Bank rate unchanged at 0.5% and the asset purchase program at 375B pound. Yet, the details unveiled that division was seen among the members over the monetary policy outlook. 2 members (presumably Martin Weale and Ian McCafferty) still favored rate hike later this year while another suggested that chance of tightening and easing in the next move was similar. Overall, the minutes continued little news after release of the quarterly inflation report last week. More in BOE Minutes Unveiled Division in Monetary Outlook.
Released earlier today, New Zealand PPI input dropped -0.4% qoq in Q4 versus expectation of -0.2% qoq, PPI outputs dropped -0.1% qoq versus expectation of -0.3% qoq. Japan trade deficit came in narrower than expected at JPY -0.41T. Eurozone current account, Swiss trade balance and UK CBI trends total orders will be released in European session. US jobless claims, Philly Fed survey and leading indicators will be released in US session.