Today Danish April CPI will be released

Market movers today

• Today we have a very light calendar in terms of data releases but there are some interesting central bank speeches. ECB’s Constancio, Nouy and Nowotny speak in Vienna and their comments could attract some attention after the ECB meeting last week at which Draghi ‘promised’ to ease in June. Following the meeting ECB’s Likanen said Draghi’s comments show our ‘common view’ and we do not expect any back tracking today.

• Fed’s Plosser speaks tonight. He is considered hawkish and although he is a voter his comments might be less interesting as they are far from the consensus on FOMC.

• During the week there are some interesting releases. In the US we get retail sales for April, euro area GDP growth in Q1 is due for release, Bank of England will publish its May Inflation Report and Chinese industrial production and Japanese inflation are due for release.

• Today Danish April CPI will be released.

Selected market news

In Ukraine voters were asked whether they endorsed the two eastern regions Donetsk and Luhansk’s declaration of self-rule. The head of the self-proclaimed Donetsk People's Republic election commission stated that 89% voted in favour of selfrule, with 10% against, on a turnout of nearly 75%. There are no results from the Lugansk area so far but final results in both regions are due today. In Kiev the government dismissed the voting as a sham and has not recognised the referendum nor the result (see BBC). Over the weekend further sanctions on Russia from western countries were suggested, as the republican and US House speaker John Boehner said that penalties should be broadened to include Russian banks and the French President Francois Hollande said tougher measures should be imposed if Russian interference prevents the 25 May Ukraine election from taking place.

Friday evening, Moody’s upgraded Portugal's government bond rating to Ba2 from Ba3. The rating action was triggered by 1) the more rapid improvement of Portugal’s fiscal situation than initially targeted, 2) the country will conclude its three-year EU/IMF support programme in the near future and 3) Portugal’s economic recovery is gaining momentum with signs of growth broadening beyond exports, which continue to perform strongly. Furthermore, Moody’s indicates that more upgrade may follow in the short term if Portugal ‘manages to bring its very high public debt ratio (currently close to 130% of GDP) onto a clear downward path in the coming years.’

Japan’s current account surplus continues to shrink posting a JPY789.9bn surplus (USD7.7bn, 0.2% of nominal GDP), the smallest current account surplus in comparable data available from 1985. This suggests that exporters have failed to reap the benefits of a more than 16% weaker JPY against the USD and at the same time inflated value of imported energy after the Fukushima disaster in March 2011.