The global markets remain unsettled by the uncertainty surrounding the start of peace negotiations between Iran and the United States. Oil prices remain at somewhat elevated levels, though index futures continue to trend upward. Earlier today, we saw inflation data releases from China and Japan.
The data from China is particularly noteworthy, as PPI inflation rose to 0.5% y/y, marking the first positive reading since October 2022. This figure slightly exceeded expectations. Meanwhile, CPI inflation slowed to 1.0% y/y, coming in below the anticipated decline to 1.2% y/y (from the previous 1.3% y/y).
Producer inflation in Japan accelerated sharply to 2.6% y/y from 2.0% y/y, driven by higher fuel costs. This serves as another signal pointing to a high probability of an interest rate hike by the Bank of Japan (BoJ) this month.
Nevertheless, the focal point of today’s calendar will be the release of U.S. CPI inflation for March. We will see how severely the energy crisis has impacted inflation and attempt to determine whether U.S. interest rate cuts are now off the table. In addition to the U.S. inflation data, we will see labor market data from Canada, the U.S. consumer sentiment index, and factory orders.
Macro Calendar:
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14:30 | USA – CPI Inflation y/y (March): Consensus: 3.4% | Previous: 2.4%
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14:30 | USA – Core CPI Inflation y/y (March): Consensus: 3.7% | Previous: 3.8%
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14:30 | Canada – Employment Change (March): Consensus: 14.5k | Previous: -83.9k
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16:00 | USA – Univ. of Michigan Consumer Sentiment (April, Prelim): Consensus: 52.1 | Previous: 54.1
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16:00 | USA – Factory Orders m/m (February): Consensus: 1.0% | Previous: -3.6%
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