- Germany March preliminary CPI +7.3% vs +6.3% y/y expected
- ADP US March unemployment +455K vs +450K exp
- US Q4 final GDP 6.9% vs 7.1% expected
- Fed's Barkin: Fed will make a call on whether 50 bps is needed at the May meeting
- Russia to reposition about 20% of troops around Kyiv, some to Belarus -- Pentagon
- ECB's Makhlouf: Ukraine war clearly represents a significant challenge to the outlook
- Fed's George: Possibility yield curve inversion should factor into balance sheet decision
- More from Fed's George: Sees neutral rate at around 2.5% as a starting point
- Germany: Russian energy supplies will be paid for exclusively in euros or dollars
- Italian PM Draghi tells Putin that Italy is willing to help in any peace process
- Putin will listen to proposals on RUB payments for gas on Thursday
- US furniture retailer sounds alarm bells on the US economy
Markets:
- Gold up $16 to $1935
- US 10-year yields down 5 bps to 2.43%
- WTI crude oil up $3.02 to $107.26
- S&P 500 down 29 points, or 0.6%, to 4602
- JPY leads, USD lags
The inflation problems continue to mount for global central banks. The regional numbers were high so by the time the national German print rolled around, the market had a good sense it would be strong. The euro climbed for the second day, this time to above the March highs. That marks a 350 pip turnaround from the start of a month that saw the worst war in Europe in a generation.
In the FX market, the dollar slumped in the early going with GBP and the commodity currencies joining the euro in making headway. As risk appetite deteriorated, all of the gains and more were wiped out. USD/CAD fell as low as 1.2430 top make a new year-to-date low but turned around to finish at 1.2476.
Cable reached 1.3182 at the London fix but fell 50 pips from there. Despite that, it still finished up a half-cent on the day on the strength of gains in Asia and early in Europe.
