Forex today: well, it was all about forex 'for the rest of the week'

There was a low-key mood in the US session today, consolidating recent turns in risk sentiment in a minor correction across the FX space.

The Trump trade came into jeopardy at the start of this month again while investors also prefer to stay on the sidelines ahead of the FOMC minutes tomorrow, US President Trump meeting with his Chinese counterpart Xi Jinping on Thursday. The main event will come in the nonfarm payrolls at the end of the week.

The US dollar and US 10y yields recovered to some degree with the DXY above the 100 handle still and up 0.02% while yields were +1.62% to 2.3569 at the time of writing. The euro was subdued again trading in a narrow 40 pip range around the midpoint of the 1.06 handle. The yen was giving some ground back to the US dollar from 110.26 lows to 110.95 the high. Sterling was choppy, consolidating the sharp fall from 1.2550 overnight down to lows of 1.2418. AUD recovered just 25 pips from the post-RBA and trade balance lows and remained below the 0.76 handle while the Kiwi consolidated within a sideways drift along 0.6970 support.

Analysts at Westpac offered a review of today's data: 

• US Feb trade balance rose from -$48.2bn to -$43.6bn (-$44.6bn expected). "There were positive surprises in both exports and imports, with positive implications for Q1 GDP forecasts. 
• Factory orders rose 1.0% in Feb (as expected). 
• Durable goods orders was finalised, Feb’s growth rate revised 0.1ppts higher at 1.8%.
• GDT dairy auction resulted in a 1.6% gain in prices overall, including a 2.4% gain in whole milk powder prices (close to futures market pricing which had indicated +1.5%).

Day ahead:  Asia preview: China on holiday, eyes on AUD and NZD

Analysts at Westpac offered a review of today's risk events:

• Australia: RBA’s Heath participates in a Bloomberg panel discussion in Sydney.
• US: Mar meeting FOMC minutes are released. Key points of interest are their assessment of neutral, given the dot plot median remained at 3.0% (8 members vs. 7 in Dec) for the longer run despite a more optimistic view on 2017, as well as discussion on the normalisation of the balance sheet. The minutes will also be the first to include fan charts outlining members’ level of uncertainty around their projections. 
• ADP employment will provide a lead on Friday’s payrolls. ADP reported that 298k jobs were added in Feb and a slower – albeit still robust – result of 180k is expected in Mar. 
• Mar ISM non-manufacturing index rose to 57.6 in Feb led by business activity and new orders. The measure is at a high back to Oct 2015.

Key notes from US session 

• Asia preview: China on holiday, eyes on AUD and NZD
• AUD/USD analysis: is the bearish breakout for real this time?
• USD/JPY analysis: losses trimmed, but bearish trend intact
• GBP/USD analysis: targeting 1.2330 on a break below 1.2410
• EUR/JPY analysis: fresh year low, and at risk of falling further
• EUR/USD analysis: choppy trading persists, as speculators wait for a trigger
• US Factory Orders: Trend in core capital orders improves - Wells Fargo
• EUR/USD remains in tight range; Fed’s Lacker resigns
• Richmond Fed Statement on Jeffrey Lacker's Announcement
• US: February trade deficit lower than expected  - Wells Fargo