US PPI at 0.0% mom, 3.2% yoy in Feb, below expectations

    US PPI for final demand as unchanged in February, coming in below expectations of 0.3% mom rise. The 0.3% mom increase in goods prices was offset by -0.2% mom decline in services.

    On an annual basis, PPI slowed to 3.2% yoy, down from January’s 3.7% yoy and missing the expected 3.3% yoy reading.

    PPI excluding food, energy, and trade services, rose 0.2% mom. Over the past 12 months, this measure advanced 3.3% yoy, maintaining a relatively steady pace.

    Full US PPI release here.

    Eurozone industrial production rises 0.8% mom, led by intermediate and capital goods

      Eurozone industrial production posted a solid 0.8% mom increase in January, aligning with market expectations. The gains were driven primarily by a 1.6% rise in intermediate goods output and a 0.5% increase in capital goods production. However, declines were seen in other categories, with energy production falling by -1.2%, durable consumer goods slipping -0.2%, and non-durable consumer goods dropping -3.1%.

      Across the broader European Union, industrial production rose by a more modest 0.3% mom. Among individual member states, Lithuania (+4.6%), Portugal (+3.7%), and Austria (+3.3%) recorded the strongest gains, while Malta (-12.9%), Denmark (-10.6%), and Slovakia (-7.3%) saw the sharpest declines.

      Full Eurozone industrial production release here.

      ECB’s Nagel: Tariffs could push Germany into recession again, but Fiscal shift provides stability

        German ECB Governing Council member Joachim Nagel warned that Germany could face a third consecutive year of economic contraction if US tariffs take full effect. Speaking to BBC, Nagel noted that without the tariffs, Germany’s economy was already expected to stagnate with minimal growth of around 0.2%. With escalating trade tensions, the risk of another recession looms large.

        Nagel sharply criticized US President Donald Trump’s tariff policies, calling them “economics from the past” and “definitely not a good idea.” He defended the EU’s decision to impose retaliatory tariffs, adding that such a response was a “necessity” rather than a choice.

        Addressing Germany’s recent shift in fiscal policy, Nagel described the decision to increase borrowing for defense and infrastructure spending as an “extraordinary measure for an extraordinary time.”

        He pointed out that the global economy is undergoing “tectonic changes,” which justify a more flexible approach to fiscal management. While Germany has traditionally maintained strict budget discipline, this shift would provide “some financial breathing room” to support recovery in the coming years, and send a “stability signal” to markets.

        BoJ’s Ueda expects real wages to rise, boosting consumption

          BoJ Governor Kazuo Ueda signaled optimism about Japan’s economic outlook, telling the parliament today that “import-cost-driven inflation” is expected to moderate while wages continue to “rise steadily.” This shift could lead to an improvement in real wages and consumption, a critical factor for sustaining domestic demand.

          Ueda’s comments align with recent developments in Japan’s annual “shunto” wage negotiations, which have resulted in record pay hikes across major companies.

          Hitachi announced a record 6.2% rise in monthly wages, fully meeting union demands. Toyota’s key auto parts supplier, Denso, also committed to historic pay hikes, while Toyota itself stated that the overall wage increase for its manufacturing staff would match last year’s levels—the highest seen since 1999.

          Further clarity on the scale of wage hikes will come on March 14, when Rengo, Japan’s largest labor union federation representing 7 million workers, releases its preliminary report. Rengo had been seeking an average wage increase of 6.09%, up from last year’s 5.85%.

          Gold gains as markets await Russia’s response to ceasefire proposal

            Gold picked up momentum as investors closely monitor Kremlin’s response to the proposed ceasefire deal in Ukraine, as US officials head to Russia for negotiations.

            Russia has yet to publicly endorse an immediate ceasefire, but has indicated that it is reviewing the plan, and a phone call between US President Donald Trump and Russian President Vladimir Putin is on the table.

            However, Trump remains skeptical, stating that while he has received “positive messages” about the ceasefire, such reassurances “mean nothing” without concrete action from Putin.

            Trump also warned that if Putin refuses to sign the deal, the US could take “financially very bad” actions against Russia, likely hinting at severe sanctions.

            Ukrainian President Volodymyr Zelenskyy said earlier in the week that stronger Western financial and military support would follow should the ceasefire negotiations fail.

            Technically, Gold’s near term rebound from 2832.41 extended higher today and focus is now on 2956.09 resistance. Decisive break there will resume the larger up trend to 3000 psychological, and possibly further to 61.8% projection of 2584.24 to 2956.09 from 2832.41 at 3062.21.

            However, break of 2905.80 support should extend the corrective pattern from 2956.09 with another falling leg back to 2832.41 and possibly below.

            US stocks find temporary support, but downside risks persist

              Risk sentiment showed signs of stabilization in the US overnight, with S&P 500 and NASDAQ posting gains. However, stocks are merely digesting recent steep losses rather than having a decisive turnaround.

              The reaction to lower-than-expected US consumer inflation data was relatively muted. The market’s cautious interpretation of the data is justified, as the latest CPI figures do not yet capture the full effects of tariff-related price pressures. There is still a lack clarity on how inflation will evolve under the new tariff regime, particularly when reciprocal tariffs come into play on April 2. Nevertheless, for the moment at least, disinflationary momentum is leaning in the Fed’s favor.

              Interestingly, market pricing has shifted the expected timing of Fed’s next rate cut back from May to June. Futures now show just 31% probability of a 25bps cut in May, while the odds for a June cut have climbed to 78%.

              Traders appear to believe Fed will need additional time to assess the economic impact of tariffs before making a policy move. From a timing perspective, June would align better with Fed’s next round of economic projections, allowing policymakers to incorporate more data into their decision-making.

              As for NASDAQ, oversold condition as seen in D RSI could start to slow downside momentum, and some near term consolidations cannot be ruled out. But risk will stay on the downside as long as 18604.46 resistance holds. Fall from 20204.58 is seen as a correction to the whole up trend from 10088.82 (2022 low) at least. It should extend to 38.2% retracement of 10088.82 to 20204.58 at 16340.36 before bottoming.

              BoC lowers rates to 2.75%, warns monetary policy can’t counter trade war fallout

                BoC delivered a widely expected 25bps rate cut, bringing the overnight rate down to 2.75%. In its statement, BoC highlighted that the rapidly evolving trade policies are injecting “more-than-usual uncertainty” into economic outlook.

                The central bank acknowledged that escalating trade tensions and newly imposed US tariffs could dampen economic growth while simultaneously increasing inflationary pressures. It emphasized that monetary policy “cannot offset the impacts of a trade war”.

                Nonetheless, BoC noted that it is committed to preventing higher prices from driving ongoing inflation. Governing Council members will carefully monitor the downward pressures on inflation stemming from a weaker economy with the upward pressures resulting from higher costs tied to tariffs and other trade barriers.

                Full BoC statement here.

                US core CPI falls to 3.1%, lowest since 2021

                  US consumer inflation slowed more than expected in February. Headline CPI rose just 0.2% mom, below forecasts of 0.3% mom. Core CPI, which excludes food and energy, also increased by 0.2% mom, missing expectations of 0.3% mom.

                  On an annual basis, inflation eased to 2.8% yoy from 3.0% yoy in January. Core CPI fell from 3.3% yoy to 3.1% yoy, the lowest level since April 2021. The deceleration in price pressures suggests that disinflationary momentum is gradually resuming after months of stubbornly high core readings.

                  Full US CPI release here.

                  ECB’s Lagarde stresses commitment to price stability amid exceptional high uncertainty

                    ECB President Christine Lagarde highlighted the “exceptionally high” level of global uncertainty in her speech today, highlighting the challenges posed by trade policy shifts and geopolitical tensions.

                    She noted that an index measuring trade policy uncertainty is now close to 350—more than six times its average value since 2021. Geopolitical risk indicators are at levels unseen since the Cold War, aside from periods of war and major terrorist attacks.

                    Against this backdrop, Lagarde emphasized that ECB’s primary focus remains on maintaining price stability over the medium term, stressing that this commitment is “more important than ever” in an unpredictable economic environment.

                    To achieve this, Lagarde stressed the need for “agility to respond to new shocks” while maintaining a structured policy framework that prevents “short-sighted reactions and unbridled discretion”.

                    She also noted the importance of combining agility with clarity, stating that while the ECB may not always be able to provide certainty about the exact path of interest rates, it can ensure “clarity about our reaction function”.

                    Full speech of ECB’s Lagarde here.

                    US CPI in focus as DOW vulnerable with double top breakdown

                      Market sentiment in the US remains fragile ahead of today’s CPI data for February, which is expected to be a major market-moving event. The challenge, however, lies in interpreting the impact of inflation data given the complex interplay between inflation trends, economic conditions, and Fed expectations. More importantly, the interaction is further complicated by the unpredictable shifts in US tariff policies. In the end, while traders may react initially to the numbers, they’re more likely to revert to pre-existing trends once the CPI risk is cleared.

                      Consensus forecast sees headline CPI dipping slightly from 3.0% to 2.9%, signaling that the uptrend from September’s low of 2.4% has finally ended. Meanwhile, core CPI is expected to ease marginally from 3.3% to 3.2%, but remains stuck in a narrow 3.2%-3.3% range since last June.

                      If the data confirms these expectations, it would reinforce the view that disinflation progress continued to stall. This, in turn, supports Fed’s cautious stance. Fed Chair Jerome Powell has repeatedly stressed that the central bank is in no rush to lower interest rates, and today’s inflation data is unlikely to change that narrative.

                      Fed fund futures are currently pricing in a 97% probability that Fed will hold rates at 4.25%-4.50% in its upcoming March 19 meeting, making it almost a certainty. However, the outlook for Q2 is much murkier. Traders are factoring in a 38% probability of a cut in May and an 85% chance of a reduction in June.

                      Beyond the near term, the real test will come in April when reciprocal tariffs are formalized. Given recent stock market volatility, where recession concerns have already led to deep selloffs, any additional economic stress from tariffs could further push Fed toward an aggressive easing cycle.

                      Some economists have already noted that the May or June rate cut could indeed start a series of swift reductions in the second half of the year, if confidence deteriorates further—especially if the labor market weakens significantly.

                      Technically, DOW should have completed a double top pattern (45073.63, 45054.36) after breaking through 41844.89 support. While deeper pull back is now in favor, strong support could be seen around 40k zone to contain downside, at least on first attempt.

                      The 40k zone represents 39889.05 resistance turned support, as well as 38.2% retracement of 32327.20 to 45054.36 at 40192.58. This development would keep price actions from 45054.36 as a correction to rise from 32327.20 only, likely a sideway pattern.

                      However, decisive break of 40k will argue that DOW is already in an even larger scale correction, or enter a bear market as some would describe.

                      BoJ’s Ueda acknowledges rising yields as market bets on policy shift

                        BoJ Governor Kazuo Ueda addressed the recent rise in bond yields, and noted, “I don’t see a big divergence between our view and that of markets”.

                        Speaking to parliament, Ueda emphasized the “biggest determinant” of long-term interest rates is market expectations regarding the central bank’s short-term policy rate.

                        He added, it is “natural for long-term rates to move in a way that reflects such market forecasts”. His comments come as Japan’s benchmark 10-year bond yield surged to a 16-year high of 1.575% on Monday.

                        Separately, Japan’s latest inflation data showed that annual wholesale inflation slowed slightly in February. Corporate goods price index , which tracks the prices businesses charge each other for goods and services, rose 4.0% yoy, in line with market expectations, down from January’s 4.2% yoy increase.

                        Loonie falls as Trump raises tariffs on Canadian metals to 50%, threatens auto industry next

                          Canadian Dollar tumbled broadly after US President Donald Trump announced a significant tariff escalation on Canadian steel and aluminum imports.

                          In a Truth Social post, Trump said he instructed the Commerce Secretary to impose an additional 25% tariff on these products, raising the total tariff to 50%.

                          The new measure, set to take effect Wednesday morning, is being framed as a response to Ontario’s 25% tariff on electricity exports to the US.

                          Trump also demanded that Canada immediately eliminate its long-standing tariffs of 250% to 390% on various US dairy products, calling them “outrageous.”

                          The tariff threat didn’t stop there. Trump warned that if Canada does not remove other tariffs he deems excessive, the US will “substantially increase” tariffs on Canadian automobile imports starting April 2nd.

                          Overall outlook in USD/CAD is unchanged that it’s still extending the corrective pattern from 1.4791 high. But current upside acceleration argues that rise from 1.4150 might be the second leg of the pattern. Break of 1.4541 will target 100% projection of 1.4150 to 1.4541 from 1.4238 at 1.4629 and above. Neverthless, break of 1.4392 minor support will bring deeper fall back to 1.4238 and below.

                          ECB’s Rehn warns US tariffs could cut global output by 0.5% in both 2025 and 2026

                            In a speech today, Finnish ECB Governing Council member Olli Rehn highlighted the potential damage that US tariffs could inflict on global economic activity.

                            According to Bank of Finland estimates, import tariffs of 25% on US imports from the Eurozone and 20% on imports from China, along with reciprocal measures by those regions, would shave more than 0.5% off global output this year and next

                            Rehn stressed that this looming trade conflict would carry both deflationary and inflationary implications for Europe. “It’s worth recalling that if growth were to slow down in the world economy and euro area economy compared to forecasts, that would weigh on inflation downwards,” Rehn said.

                            Given this uncertainty, he noted that ECB will assess fresh economic data ahead of its April meeting before committing to additional rate cuts or a pause.

                            US stock market correction deepens as recession fears take hold

                              The US stock market suffered its most significant setback in months, with the S&P 500 dropping -2.7%, its biggest one-day decline since December 18. NASDAQ also lost -4.0%, marking its worst single-day percentage loss since September 2022. Analysts widely point to mounting recession worries as the primary catalyst behind the selloff.

                              Initial concerns emerged over the past month following a series of weaker economic data points, believed by some to be early reactions to an increasingly contentious tariff policy. These worries intensified after recent remarks from the White House suggested a bumpy economic outlook ahead.

                              In an interview aired on Sunday, US President Donald Trump fueled apprehensions further by describing the economy as going through “a period of transition.” When pressed about an impending recession, he avoided a direct prediction but acknowledged potential “disruption.”
                              His remarks—“Look, we’re going to have disruption, but we’re OK with that”—did little to reassure investors already on edge about growth prospects.

                              Adding further weight to recession fears, historical bond market indicators have been flashing warning signs. The 10-year to 2-year US yield curve inverted in mid-2022—a classic recession signal—and only turned positive again in September 2024. Historically, a U.S. recession tends to follow within months after the yield curve normalizes (i.e., turned positive again). If this trend holds true, the US economy could be inching closer to a downturn.

                              However, another view posits that tariffs are a distraction and that the real driver behind the US selloff is the recent surge in Japanese government bond yields, which have hit a 16-year high. As the carry trade unwinds—where investors borrow in low-yield currencies, often involving Japanese Yen, to fund investments in higher-yield or high-growth assets—capital is flowing out of big tech names, contributing to the NASDAQ’s outsized losses.

                              Technically, NASDAQ’s strong break of 55 W EMA (now at 17864.01) suggests that it’s already in correction to the up trend from 10088.82 (2022 low). Deeper fall should be seen to 38.2% retracement of 10088.82 to 20204.58 at 16340.36. Reaction from there will decide whether it’s merely in a medium consolidations phase or in an out-right bearish trend reversal.

                              As for DOW, immediate focus is now on 41844.89 support. Firm break there will complete a double top reversal pattern (45073.63, 45054.36). That should set up deeper fall to 38.2% retracement of 32327.20 to 45073.63 at 40204.49 at least, even it’s just a correction to the rise from 32327.20.

                               

                               

                              Australia’s NAB business confidence slips back into negative as cost pressures persist

                                Australia’s NAB Business Confidence fell from 5 to -1 in February, erasing last month’s gain and returning to below-average levels. While business conditions improved slightly from 3 to 4, the decline in confidence suggests that businesses remain cautious despite RBA’s recent rate cut and positive Q4 GDP data.

                                NAB Chief Economist Alan Oster noted that the lift in sentiment seen in January was not sustained, signaling ongoing uncertainty in the business environment. Persistent cost pressures and subdued profitability appear to be key factors weighing on sentiment, keeping confidence below long-term norms.

                                Within business conditions, trading conditions ticked up from 7 to 8, and profitability conditions rose slightly from -2 to -1, though still remaining in negative territory. Employment conditions, however, weakened from 5 to 4.

                                Cost pressures remain a concern, with purchase cost growth accelerating from 1.1% to 1.5% in quarterly equivalent terms. On the positive side, labor cost growth eased from 1.7% to 1.5%, indicating that wage price pressures are gradually cooling. Meanwhile, final product price growth slowed from 0.8% to 0.5%, though retail price inflation held steady at 1.0%.

                                Full Australia NAB Monthly Business Survey here.

                                Australia Westpac consumer sentiment jumps to 95.9, soft landing achieved

                                  Australian consumer sentiment saw a strong rebound in March, with Westpac Consumer Sentiment Index jumping 4.0% mom to 95.9, the highest level in three years and not far from neutral 100 mark.

                                  Westpac attributed the improvement to slowing inflation and February’s RBA interest rate cut which have lifted confidence across households. positive views on job security suggest that “soft landing has been achieved”. Nevertheless, “unsettling overseas news” continues to weigh on the broader economic outlook.

                                  Looking ahead to RBA’s upcoming meeting on March 31-April 1, Westpac expects the central bank to keep the cash rate unchanged. RBA was clear that the 25bps cut in February “did not mean further reductions could be expected at subsequent meetings.”

                                  Westpac added, “further slowing in inflation will give the RBA sufficient confidence to deliver more rate cuts this year with the next move coming at the May meeting”.

                                  Full Australia Westpac Consumer Sentiment release here.

                                  ECB’s Kazimir: No automatic decisions or rushing

                                    Slovak ECB Governing Council member Peter Kazimir emphasized the need for flexibility in monetary policy, cautioning against premature decisions on interest rate cuts.

                                    In a blog post, he highlighted that inflation risks remain “tilted to the upside”. He added that historical precedent showing that tariffs tend to slow economic growth while simultaneously pushing prices higher—precisely the scenario ECB seeks to avoid.

                                    Given these uncertainties, Kazimir reinforced the importance of keeping “all options open,” suggesting that the ECB could either proceed with further rate cuts or pause.

                                    He made it clear that he is still seeking “undeniable confirmation” that the current disinflation trend will persist before endorsing any easing measures.

                                    With inflation dynamics remaining complex, he stressed that “now is not the time for automatic decisions or rushing.”

                                    Eurozone Sentix investor confidence jumps to -2.9, Germany feeling downright euphoric

                                      Eurozone Sentix Investor Confidence index jumped from -12.7 to -2.9, far exceeding market expectations of -10 and reaching its highest level since June 2024. Current Situation Index improved relatively modestly from -25.5 to -21.8. Expectations Index soared from 1.0 to 18.0, marking its third consecutive increase and the highest reading since July 2021. This month’s surge in expectations represents the largest monthly increase since 2012, signaling a dramatic shift in sentiment among investors.

                                      Germany saw an even more impressive turnaround. The Invest Confidence index rose from -29.7 to -12.5, its best level since April 2023. Current Situation Index climbed from -50.8 to -40.5, the highest since July 2024. Meanwhile, Expectations surged from -5.8 to 20.5, marking the highest level since July 2021.

                                      According to Sentix, much of this optimism is rooted in expectations for increased investment in the EU’s armaments sector and Germany’s infrastructure, which has left investors feeling “downright euphoric” about future prospects.

                                      In contrast, investor sentiment in the US deteriorated significantly. The Sentix Investor Confidence Index plunged from 21.2 to -2.7, its lowest level since 2023. The Current Situation Index dropped from 35.3 to 13.5, the weakest reading since September 2024, while the Expectations Index tumbled from 8.0 to -7.8, its lowest since November 2022.

                                      Sentix described this downturn as a “historic turning point,” with such a sharp simultaneous decline in both current and expected values only observed once before—during the 2008 financial crisis.

                                      Full Eurozone Sentix release here.

                                      Bitcoin and Ethereum slide further as market reacts to strategic reserve letdown

                                        Bitcoin has come under selling pressure in recent days, and slips closer to 80k mark. Ethereum, with a even worse outlook, has been struggling at its lowest levels since late 2023.

                                        The broader cryptocurrency market has been in decline since early February, mirroring weak risk sentiment in the US financial markets. While there was a brief revival earlier this month after US President Donald Trump announced plans to establish a “strategic reserve” for cryptos, that optimism quickly faded once details of the initiative were revealed.

                                        The market’s disappointment stemmed from the fact that the reserve would be funded solely by those seized in criminal and civil forfeiture cases, with no actual government purchases planned. Many investors had initially hoped for a more aggressive accumulation strategy.

                                        Technically, Bitcoin is still holding above 55 W EMA (now at 75052), which is slightly above 73812 cluster support (38.2% retracement of 15452. to 109571 at 73617). Price actions from 109571 high could still be seen as just forming a sideway consolidation pattern.

                                        However, decisive break of 73k-75k support zone will argue that Bitcoin is already in a medium term downtrend, even still as correction. In the bearish case, Bitcoin could head to around 50k mark, that is, 49008 support and 61.8% retracement at 51405,before bottoming.

                                        Outlook for Ethereum is even worse with focus now on 2000 psychological level, which is close to 2084.51 cluster support (61.8% retracement of 878.50 to 4108.15 at 2112.22).

                                        Sustained break of this support zone around 2000 will raise the chance that fall from 4108.15 is the third leg of the decline from 4863.75 (2021 high). That could set up deeper medium term fall through 878.50 (2022 low).

                                        Japan’s nominal wages rises 2.8% yoy in Jan, real wages fall -1.8% yoy

                                          Japan’s labor cash earnings rose 2.8% yoy in January, falling short of market expectations of 3.2% yoy. Nominal wage growth remained positive for the 37th month.

                                          Real wages, adjusted for inflation, fell -1.8% yoy, reversing two months of slight gains. The decline was largely driven by a sharp rise in consumer inflation.

                                          The inflation rate used by the Ministry of Health, Labor and Welfare to calculate real wages—which includes fresh food prices but excludes rent—accelerated to 4.7% yoy, its highest level since January 2023.

                                          Regular pay, or base salary, rose 3.1% yoy, the largest gain since 1992. This was overshadowed by a sharp -3.7% yoy decline in special payments, which consist largely of one-off bonuses.