Asian markets closed the day mixed after the Monetary Authority of Singapore took action to fend deflation concerns by loosening its monetary policy. The MAS will act by reducing the “slope” of the band which prevents the SGD from appreciating too fast against a basket of other currencies. The announcement took markets by surprise as it came well ahead of next policy meeting in April. Singapore’s decision followed other surprise announcements such as those of India, Switzerland and Canada. As several other central banks are scheduled to meet later in the week, this move could imply more easing to come by other world players in the near term.
In Europe markets are currently lacking direction as investors await the results of the FOMC meeting during the US session. Meanwhile in Greece, markets continue to extend losses after the left-wing Syriza party won the elections. By contrast, the Euro furthers its rebound after the recent trough and is currently trading at $1.1354.
The FOMC policy announcement will constitute the highlight of the day for the US session as the earnings season continues to showcase surprises.