Market movers ahead
- The US employment report is released on Good Friday. Following a run of months with very strong job gains we expect the pace of labour market improvement to moderate but remain healthy. We expect overall job growth at 230,000 in March.
- On Monday next week, we are due to get the March manufacturing ISM index. We expect the ISM to take a small dip to 52.0.
- The minutes of the 17-18 March FOMC meeting are due to be released on Wednesday 8 April
- In the euro area, we expect HICP inflation to increase from -0.3% y/y in February to -0.1% in March.
- German factory orders were quite weak in January and we expect some normalisation in February, forecasting an increase of 3.0% m/m after it declined 3.9% m/m in January. On the other hand, German industrial production has been on a clear uptrend and in January it increased for the fifth month in a row.
- In the UK in the coming two weeks, the Monetary Policy Committee will hold its April meeting. We expect the Bank Rate and the stock of purchased assets to remain unchanged at 0.50% and GBP375bn, respectively.
- In China, the most important event next week will be the official manufacturing PMI. We expect PMI to decline to 49.4 in March from 49.9 in February. We expect the increase in Chinese CPI to stay unchanged at 1.4% y/y in March.
- In Japan, next week’s main events are industrial production for February on Monday and the Bank of Japan’s (BoJ) Tankan business survey for Q1 on Wednesday.
Global macro and market themes
- Europe continues to deliver good news – other regions disappoint.
- Still positive on risk assets based on global recovery and ample liquidity.
- Time to add to periphery bonds.
- Limited upside to oil price as oil glut remains.
- EUR/USD to go lower after correction.
Recommended Content
Editors’ Picks
EUR/USD rebounds to 1.0650 on renewed USD weakness
EUR/USD gained traction and rose to the 1.0650 area in the early American session on Tuesday. Disappointing housing data from the US seem to be weighing on the US Dollar, helping the pair stretch higher.
GBP/USD climbs above 1.2450 after US data
GBP/USD extended its recovery from the multi-month low it touched near 1.2400 and turned positive on the day above 1.2450. The modest selling pressure surrounding the US Dollar after dismal housing data supports the pair's rebound.
Gold retreats to $2,370 as US yields push higher
Gold stages a correction on Tuesday and fluctuates in negative territory near $2,370 following Monday's upsurge. The benchmark 10-year US Treasury bond yield continues to push higher above 4.6% and makes it difficult for XAU/USD to gain traction.
XRP struggles below $0.50 resistance as SEC vs. Ripple lawsuit likely to enter final pretrial conference
XRP is struggling with resistance at $0.50 as Ripple and the US Securities and Exchange Commission (SEC) are gearing up for the final pretrial conference on Tuesday at a New York court.
US outperformance continues
The economic divergence between the US and the rest of the world has become increasingly pronounced. The latest US inflation prints highlight that underlying inflation pressures seemingly remain stickier than in most other parts of the world supported by a strong US labour market.