The Bank of Japan has surprised investors by appointing an academic, Kazuo Ueda, as its next governor, replacing Haruhiko Kuroda. Ueda's nomination is seen as a signal that the BOJ could phase out its unpopular yield control policy soon. Ueda could very well face the challenge of normalising the ultra-easy policy given that inflation has risen above the BOJ's target, but investors are eagerly awaiting developments as he is anticipated to dismantle yield curve control as soon as possible.

EQUITY

The stock market had a positive performance on Monday, with the major indices closing higher. The US 10-year rate is currently at 3.7%, and the focus this week is on Tuesday's inflation data and speeches from Fed officials. Market participants appear to be upbeat, with majority of S&P 500 companies reporting higher-than-expected profits, pushing the index 1.15% higher on Monday.

GOLD

Gold prices increased slightly on Tuesday, following a 0.62% drop on Monday, due to low trading volume as investors awaited the U.S. CPI data. The dollar stabilised with concerns over inflation potentially leading to interest rate hikes by the Federal Reserve, while gold prices were impacted by rising interest rates and fears of the Fed.

OIL

Oil prices decreased on Monday as the US government announced the sale of 26 million barrels of crude from its Strategic Petroleum Reserve. The decrease was cushioned by a shipment of Azeri crude from Turkey since the earthquake and the US's expected record-high production in March. However, market attention remains on the impact of the additional crude sales as well as caution ahead of a key U.S. inflation reading and a potential slowdown in consumption.

CURRENCY

The dollar dropped due to higher stocks and lower Treasury yields. However, it rose against the yen as the Federal Reserve is expected to tighten its monetary policy. The euro rises after it previously hit a one-month low. The Swiss franc strengthened after higher-than-expected Swiss inflation data.