Morning Wrap (18.04.2024)

Indexes from Asia and the Pacific are mostly experiencing an upward session. Chinese indexes are gaining the most, including HSCEI (+1.50%) and FTSE China A50 (+1.35%). Increases are also observed on the Japanese Nikkei225 (+1.00%) and in Singapore on SG20cash (+1.40%).

Futures contracts on European indexes also indicate a slightly higher opening for the cash session in Europe. Contracts for indexes from Germany and the UK are gaining 0.10%-0.20%.

In the forex market, movements are limited in the first part of the day, with most changes for major currency pairs fluctuating within +/-0.10%.

Asahi Noguchi, a member of the Bank of Japan (BoJ) board, stated on Thursday that the Bank of Japan should approach further changes in monetary policy cautiously, as domestic inflationary pressure is still not too strong.

"The pace of interest rate adjustment in Japan is expected to be incomparably slower than that of other major central banks," Noguchi said in a speech on Thursday.

According to official data released on Thursday by the Australian Bureau of Statistics (ABS), the unemployment rate in Australia rose to 3.8% in March, compared to expectations of 3.9% and a previous result of 3.7%. Employment change in Australia was -6.6 thousand in March compared to 116.5 thousand in February, against a consensus forecast of 7.2 thousand.

G7 foreign ministers met on Wednesday for discussions on the Italian island of Capri. The dominant topic of the meeting was the conflict in the Middle East and the USA's calls for new sanctions on Iran.

Furthermore, participants debated ways to persuade Israel not to escalate the conflict with Iran following Iranian attacks on Israel over the weekend.

Michelle Bowman, Governor of the Federal Reserve (Fed), stated on Wednesday at the end of the day that inflation progress is slowing and may even have stalled. Bowman further stated that monetary policy is currently restrictive, and time will tell if it is "sufficiently" restrictive.

Loretta Mester, President of the Federal Reserve Bank of Cleveland, said that monetary policy is sufficiently restrictive. However, she added that the central bank should not rush to cut interest rates, and recent strong economic data provides room to maintain interest rates longer.

In the cryptocurrency market, a slight rebound is observed. Bitcoin, after testing the 60000 USD level yesterday, gains today by 0.70% to 61700 USD. Similarly, Ethereum, which briefly broke below the 3000 USD level during yesterday's declines, gains 1.00% today to 3020 USD.

In the cryptocurrency market, we observe panic among short-term investors, which has turned into dynamic declines. Moreover, tomorrow will be the Bitcoin halving, during which the rewards for mining the next block will be halved. Therefore, the current selling pressure also comes from miners who need to sell their BTC stocks to secure against lower revenues.