The financial markets are rather steady in the Asian session today. The Nikkei pared back some of the BoJ triggered gains and is trading down -100 pts at the time of writing. Major indices in Asia are mixed following the mixed close in US, where the Dow dropped -0.15% and S&P 500 rose 0.12%. US long term treasuries continued to struggle in consolidation with 30 year yield hovered around 3.65/3.70 level while 10 year yield hovered around 2.70/2.73. Commodities were strong with gold surging to 1332 overnight and is staying well above 1300 handle for the moment. Crude oil also jumped sharply yesterday and breached 103, trading at 102.7 currently.
UK events will be the major focus in European session today. The BoE will release February meeting minutes. At that meeting, the BoE held rates unchanged at 0.50% and maintained the asset-purchase target at GBP 375b. The minutes would likely reveal unanimous votes for those results. BoE has already updated the forward guidance in last week's inflation report with Carney provided much information during the press conference. Thus, we're not expecting anything new from the minutes. The market moving one could instead bye the job market data, which is expected to chose claimant count fell -18.3k in January. The unemployment rate is expected to be unchanged at 7.1% in December.
Sterling surged last week as the inflation report hinted at the possibility of rate hike in 2015. However, the pound suffered some set back against the dollar and euro after yesterday's CPI data, which fell below BoE's target for the first time since November 2009. In particular, the EUR/GBP has defended a key long term support level of 0.8164 and rebounded. Such rebound also provided some needed fuel for the EUR/USD to get through 1.3739 resistance. We'd be cautious on more pull back in sterling should today's employment data disappoints.
The FOMC minutes of January meeting will be another major focus today. Nonetheless, the information in the minutes shouldn't deviate from Fed chair Yellen's testimony to Congress last week. The Fed would likely reiterate it would continue with measured tapering, by USD 10b during every FOMC meeting, should economy evolves as expected. A major note to note is whether there are debates on adjusting the unemployment threshold.
On the data front, the Australian conference board leading indicator rose 0.8% in December. Japan will lease all industry activity index and BoJ monthly report. UK will release BoE minutes and job data in European session while Swiss will release ZEW expectations. The US will release new residential construction, PPI and FOMC minutes.