Market takes Yellen’s comments as dovish

•     Market takes Yellen’s comments as dovish

–    Although she confirms that they are likely to raise rates as early as June, it depends on the data. They won’t necessarily start hiking rates right after dropping “patient”

–    Moreover she said they were looking at inflation including food & energy as well as core PCE, which is also dovish

–    Fed funds rate expectations fall sharply. USD still underpinned as next move is still up, but rate of strengthening may be slower than I had anticipated

•     BoC Gov. Poloz surprises with dovish statement

–    Says cut in rates has bought some time, implying no hike in March meeting

–    With oil prices still falling and rates likely to fall, I still think CAD is likely to weaken

•     Eurozone accepts Greek proposals

–    New questions:  how do they finance the government for now? And how to raise taxes?

•     China HSBC/Markit manufacturing PMI for Feb @ 50.1

–    Move back above 50 boosts AUD and NZD, at least temporarily

•     Today:

–    Eurozone: French consumer confidence for Feb

–    Sweden: Minutes of latest Riksbank meeting   Norway: AKU unemployment

–    US: 2^nd day of Yellen testimony; new home sales for January