Headlines:
- China Q1 GDP +2.2% vs +2.2% q/q expected
- Fairly muted reaction to China's GDP data
- RBA minutes show strong case to pause and reassess need for tightening at future meetings
- BOJ is considering a 2025 CPI forecast that is still under target
- BOJ's Ueda: Buying government debt is part of monetary policy
- BOJ's Uchida: Fiscal constraints won't undermine ability to carry out monetary policy
- PBOC sets USD/ CNY reference rate for today at 6.8814 (vs. estimate at 6.8828)
Markets:
- AUD leads, USD lags so far on the day
- Asian equities mostly higher, Hang Seng down
- US 10-year yields up 0.4 bps to 3.594%
- Gold up 0.3% to $2,000.08
- WTI crude up 0.4% to $81.18
- Bitcoin up 0.1% to $29,486
China's Q1 GDP data and retail sales numbers for March impressed but that wasn't enough to get markets excited to start the day. Perhaps the optimism has already been baked in, as the strong rebound in activity comes after China lifted Covid-19 restrictions in December last year.
Asian equities are holding on to some optimism from Wall Street overnight, with the Nikkei up 0.6% on the day. The Shanghai Composite is flattish, while the Hang Seng is keeping lower by 0.7% despite the upbeat data domestically.
In the major currencies space, there wasn't much movement overall. The aussie is the only currency seen slightly higher, also reacting to the RBA minutes - which suggested that the central bank was "considering" a rate hike at its April meeting two weeks ago.
Besides that, we're just hearing a bit from BOJ policymakers that they will not be perturbed by any fiscal burdens if they were to change up their policy settings moving forward. However, the latest report today suggests that with inflation forecasts still sitting under the price target by 2025, perhaps it is not time yet for Ueda to bring about changes to the central bank later this month.
