Notes/Observations
- Treasury yields resume climb to fresh 13-month highs; dealers cite President Biden’s infrastructure spending plan as catalyst
- Germany’s Mar State CPI readings show upward shift in inflation
Asia:
- Japan Feb Retail Sales beats expectations (M/M: 3.1% v 0.8%e; Y/Y: -1.5% v -2.9%e)
- BOJ Gov Kuroda reiterated important for BOJ to hit 2% CPI target and still possible to achieve CPI Target but would take time
- President Biden and Japan PM Suga said to be expected to note the Taiwan Strait in joint statement when they meet in April. To affirm the importance of stability in the Taiwan Strait as well as take a unified stance opposing China’s new law empowering the coast guard
Coronavirus:
- Total global cases 127.6M (+0.4% d/d); total deaths: 2.79M (+0.3% d/d)
Europe:
- ECB’s Vasiliauskas (Lithuania) reiterated Council concern of shifting policy too quickly adding that too much stimulus was less risky than not enough
- Turkey President Erdogan fired Central Bank Deputy Gov Cetinkaya and appointed Mustafa Duman to replace him
- German Chancellor Merkel, France President Macron and UK PM Johnson called for an end to isolationism and nationalism in favor of a new era of solidarity. The world needed a global settlement like that made after WW2
Americas:
- Fed’s Waller stated that the Fed would not set policy to help finance govt debt; Fed must maintain independence on interest rate decisions to control inflation. Yield curve control was an available tool but there were a lot of questions about YCC’s cost and benefit
Speakers/Fixed income/FX/Commodities/Erratum
Equities
- Indices [Stoxx600 +0.38% at 429.24, FTSE +0.36% at 6,760.65, DAX +0.62% at 14,910.00, CAC-40 +0.46% at 6,043.18, IBEX-35 +0.49% at 534, FTSE MIB +0.39% at 24,515.50, SMI +0.17% at 11,108.37, S&P 500 Futures -0.07%]
- Market Focal Points/Key Themes: European indices open higher across the board and remained in the green as the session progressed; sectors leading ot the upside include financials and materials; health care and utilities sectors among those underperforming; Israel closed for holiday; Wartsila divests Euroatlas unit; companies expected to report in the upcoming US session include BlackBerry
Equities
- Consumer discretionary: Scout24 [G24.DE] +4% (buyback), Royal Mail [RMG.UK] +2% (trading update)
- Consumer staples: Imperial Brands [IMB.UK] -1% (trading update)
- Utilities: Pennon [PNN.UK] -3% (trading update)
- Industrials: MAN [MAN.DE] +1% (restructuring)
Speakers
- Germany Finance Ministry commented on Q2 issuance which maintained its bill issuance at €60B while raising the Capital Market issuance by €2.5B to €59.5B. The Ministry noted that uncertainty might necessitate more issuance changes in 3Q, 4Q,
- Indonesia Central Bank reiterated stance on IDR currency (Rupiah); says exchange rate remains undervalued and has potential to strengthen
Currencies/Fixed Income
- USD firmer as US Treasury yields resumed its climb to fresh 13-month highs. DXY dollar index at 4.5-month high and USD/JPY to its highest in a year. Dealers cited President Joe Biden’s infrastructure spending plan as the catalyst (**Insight: New Biden infrastructure proposal could possibly be as much as $4T in new spending and more than $3T in tax increases)
- EUR/USD was lower despite Germany’s Mar State CPI readings showing an upward shift in inflation. Pair still weighed down over the concerns over pandemic and the headwinds for growth. Dea;ers see 1.15 as key resistance in pair with 1.20 as resistance
- USD/JPY initially stalled at the 110 level with reports that Japanese exporters were selling around there but the pair found enough impetus to hit a fresh 1-year high at 110.27. Dealers cited the widening bond yield gap between the US and Japan . The move above 110 paves the way for a possible retest of the pivotal 112 resistance level.
- TRY currency (Lira) weaker after Turkey President Erdogan again sacked another member of the central bank’ (this time the deputy governor) just days after removing its head. USD/TRY trading at 8.28 and within testing the key resistance area of 8.50
- Euro Zone government bond yields were higher across the board in the session. Dealers cited quarterly funding review and inflation data as catalysts of Bund yields. Several blocks of 5K contracts went through during the session in the Jun Bund contract
Economic data
- (DE) Germany Mar CPI North Rhine Westphalia M/M: 0.5% v 0.8% prior; Y/Y: 1.8% v 1.3% prior
- (FI) Finland Feb Unemployment Rate: 8.1% v 8.7% prior
- (FI) Finland Feb House Price Index M/M: +1.4 v -1.6% prior; Y/Y: 1.2% v 1.1% prior
- (DE) Germany Feb Import Price Index M/M: 1.7% v 1.3%e; Y/Y: 1.4% v 1.1%e
- (NO) Norway Feb Retail Sales M/M: -0.3% v +0.7%e
- (ZA) South Africa Feb M3 Money Supply Y/Y: 7.5% v 9.0%e; Private Sector Credit Y/Y: 2.6% v 3.3%e
- (FR) France Mar Consumer Confidence: 94 v 91e
- (ES) Spain Mar Preliminary CPI M/M: 1.0% v 0.6%e; Y/Y: 1.3% v 0.9%e
- (ES) Spain Mar Preliminary CPI EU Harmonized M/M: 1.9% v 1.6%e; Y/Y: 1.2% v 0.9%e
- (ES) Spain Feb Adjusted Retail Sales Y/Y: -5.9% v -6.2%e; Retail Sales (unadj) Y/Y: -9.4% v -10.8% prior
- (CH) Swiss Mar KOF Leading Indicator: 117.8 v 104.3e
- (AT) Austria Feb PPI M/M: 0.8% v 0.9% prior; Y/Y: +0.9% v -0.3% prior
- (SE) Sweden Mar Consumer Confidence: 97.1 v 97.5 prior; Manufacturing Confidence: 117.7 v 114.9 prior; Economic Tendency Survey: 105.3 v 105.0e
- (HU) Hungary Feb Unemployment Rate: 4.5% v 4.5%e
- (DE) Germany Mar CPI Baden Wuerttemberg M/M: 0.6% v 0.7% prior; Y/Y: 1.9% v 1.4% prior
- (DE) Germany Mar CPI Brandenburg M/M: 0.7% v 0.6% prior; Y/Y: 2.0% v 1.4% prior
- (DE) Germany Mar CPI Hesse M/M: 0.5% v 0.8% prior; Y/Y: 1.7% v 1.0% prior
- (DE) Germany Mar CPI Bavaria M/M: 0.5% v 0.6% prior; Y/Y: 1.8% v 1.3% prior
- (PT) Portugal Mar Consumer Confidence Index: -23.0 v -24.4 prior; Economic Climate Indicator: -1.1 v -1.0 prior
- (HK) Hong Kong Feb Retail Sales Value Y/Y: 30.0% v 44.0%e; Retail Sales Volume Y/Y: 31.7% v 42.5%e
- (EU) Euro Zone Mar Economic Confidence: 101.0 v 96.0e; Industrial Confidence: 2.0 v 0.0e; Services Confidence: #–9.3 v -14.9e; Consumer Confidence (final): -10.8 v -10.8 advance
Fixed income Issuance
- (IN) India sold total INR190B vs. INR190B indicated in 3-month, 6-month and 12-month bills
- (DK) Denmark sold total DKK2.76B in 3-month, 6-month, 9-month and 12-month bills
Looking Ahead
- (MX) Mexico Feb YTD Budget Balance (MXN): No est v -8.0B prior
- (EU) Daily ECB Liquidity Stats
- (IT) Italy Debt Agency (Tesoro) to sell €6.0-7.0B in 5-year and 10-year BTP bonds
- (IT) Italy Debt Agency (Tesoro) to sell €1.0-1.5B in Apr 2026 CCTeu (floating rate Notes)
- 05:15 (CH) Switzerland to sell 3-month Bills
- 05:30 (ZA) South Africa Q4 Non-Farm Payrolls Q/Q: 1.3%e v 0.8% prior; Y/Y-5.0%e v -6.0% prior
- 05:30 (HU) Hungary Debt Agency (AKK) to sell 3-Month Bills
- 05:30 (EU) ECB allotment in 7-Day Main Refinancing Tender (MRO)
- 05:30 (ZA) South Africa to sell combined ZAR6.6B in 2037, 2044 and 2048 bonds
- 06:00 (PT) Portugal Feb Industrial Production M/M: No est v -1.3% prior; Y/Y: No est v -6.5% prior
- 06:00 (PT) Portugal Feb Retail Sales M/M: No est v -4.8% prior; Y/Y: No est v -10.9% prior
- 06:45 (US) Daily Libor Fixing
- 07:00 (BR) Brazil Mar FGV Inflation IGPM M/M: 3.2%e v 2.5% prior; Y/Y: 31.4%e v 28.9% prior
- 08:00 (DE) Germany Mar Preliminary CPI M/M: 0.5%e v 0.7% prior; Y/Y: 1.7%e v 1.3% prior
- 08:00 (DE) Germany Mar Preliminary CPI EU Harmonized M/M: 0.5%e v 0.6% prior; Y/Y: 2.0%e v 1.6% prior
- 08:00 (ZA) South Africa Feb Monthly Budget Balance (ZAR): -17.1Be v -76.2B prior
- 08:00 (BR) Brazil Feb PPI Manufacturing M/M: No est v 2.9% prior; Y/Y: No est v 21.5% prior
- 08:00 (UK) Daily Baltic Dry Bulk Index
- 08:55 (US) Weekly Redbook LFL Sales data
- 09:00 (US) Jan FHFA House Price Index M/M: 1.2%e v 1.1% prior
- 09:00 (US) Jan S&P/CaseShiller(20-City) House Price Index M/M: 1.20%e v 1.25% prior; Y/Y: 11.35%e v 10.10% prior
- 09:00 (US) Jan S&P/CaseShiller(Overall) House Price Index Y/Y: No est v 10.37% prior
- 09:00 (EU) Weekly ECB Forex Reserves
- 09:00 (US) Fed’s Quarles
- 09:00 (RU) Russia announcement on upcoming OFZ bond issuance (held on Wed)
- 09:30 (BR) Brazil Feb Total Formal Job Creation: +257.5Ke v +260.4K prior
- 09:45 (UK) BOE to buy £1.48B in APF Gilt purchase operation (over 20-years)
- 10:00 (US) Mar Consumer Confidence: 96.0e v 91.3 prior
- 11:00 (MX) Mexico Weekly International Reserve data
- 11:00 (SE) Sweden Central Bank (Riksbank) Gov Ingves
- 11:00 (PT) ECB’s Centeno (Portugal)
- 14:30 (US) Fed’s Williams
- 15:00 (AR) Argentina Q4 Current Account Balance: -$1.3Be v $1.2B prior
- 15:00 (AR) Argentina Jan Economic Activity Index (Monthly GDP) M/M: No est v 0.9% prior; Y/Y: -2.6%e v -2.2% prior
- 16:30 (US) Weekly API Oil Inventories
- 17:00 (CL) Chile Central Bank (BCCh) Interest Rate Decision: Expected to leave Overnight Rate Target unchanged at 0.50%
- 17:00 (KR) South Korea Apr Business Manufacturing Survey: No est v 85 prior; Non-Manufacturing Survey: No est v 73 prior
- 19:00 (KR) South Korea Feb Industrial Production M/M: +1.1%e%e v -1.6% prior; Y/Y: 1.0%e v 7.5% prior
- 19:01 (UK) Mar BRC Shop Price Index Y/Y: No est v -2.4% prior
- 19:50 (JP) Japan Feb Preliminary Industrial Production M/M: -1.3%e v +4.3% prior; Y/Y: -1.8%e v -5.2% prior
- 20:00 (NZ) New Zealand Mar Final Business Confidence: No est v 0.0 prelim; Activity Outlook: No est v 17.4 prelim
- 20:30 (AU) Australia Feb Private Sector Credit M/M: 0.3%e v 0.2% prior; Y/Y: 1.7%e v 1.7% prior
- 20:30 (AU) Australia Feb Building Approvals M/M: +3.0%e v -19.4% prior
- 21:00 (CN) China Mar Manufacturing PMI (Govt official): 51.2e v 50.6 prior; Non-manufacturing PMI: 52.0e v 51.4 prior; Composite PMI: No est v 51.6 prior
- 21:10 (JP) BOJ Outright Bond Purchase Operation for 3~5 Years, 10~25 Years and 25 Years~ maturities
- 22:00 (SG) Singapore Feb M2 Money Supply Y/Y: No est v 11.3% prior; M1 Money Supply Y/Y: No est v 31.2% prior
- 23:30 (TH) Thailand Feb ISIC Manufacturing Production Index Y/Y: +0.6%e v -2.8% prior; Capacity Utilization: No est v 66.4% prior
