Last week concluded with the derivatives market once again projecting nearly four Federal Reserve cuts for the year. However, this week's data has seen expectations realign with the Fed's initial signal of three rate cuts in December, while reducing the likelihood of a June hike to its lowest point in over four months. Consequently, this shift has bolstered the dollar against all G10 currencies.

Across Asia Pacific, equities predominantly trended lower both today and throughout the week. Meanwhile, Europe's Stoxx 600 index experienced a second consecutive session of softness, hovering close to record levels. US index futures show a steady-to-firmer stance.

Gold found support around $2150 this week after peaking at $2195 last week, consolidating within Tuesday's trading range. May WTI crude oil is consolidating following a two-day surge that elevated it from approximately $77.30 to just above $81.00 yesterday, marking its highest level since October.

Asia Pacific
Japan's tertiary activity index saw a marginal uptick of 0.3% in January, somewhat mitigating the impact of a string of poor data at the year's outset. Notably, an earthquake on New Year's Day precipitated a significant 7.5% decline in industrial production for January, alongside decreases in housing starts and household spending.

The dollar reached a five-day peak near JPY148.40 in North America yesterday, while the Australian dollar also dipped to five-day lows around $0.6570.

Europe 
Confidence persists in the expectation that the European Central Bank will implement its first rate cut in June, mirroring sentiments of the Federal Reserve and other G10 central banks. ECB officials aim to gain increased assurance that inflation is trending back toward the 2% target.

Ahead of the Bank of England meeting on March 21, the UK's February CPI report is anticipated to show a significant decline.

The euro declined to a five-day low near $1.0880 yesterday before rebounding to almost $1.0900 during European trading, while sterling experienced a five-day low near $1.2730 and closed below its low, displaying a bearish outside down day.

America
February retail sales rebounded from January's revised 1.1% decline (initially -0.8%), though the 0.6% increase fell short of expectations. Focus now shifts to US Fed industrial production, anticipated to benefit from a recovery in manufacturing output (~0.3% following a 0.5% decline in January).
The FOMC convenes next week, drawing attention from investors and analysts alike.