Headlines:
- EUR/USD climbs to four-week high amid sluggish dollar
- The early signs point to some brutal inflation numbers from Europe
- Spain March preliminary CPI +9.8% vs +8.0% y/y expected
- Saxony March CPI +7.0% vs +4.9% y/y prior
- Bavaria March CPI +7.8% vs +5.3% y/y prior
- North Rhine Westphalia March CPI +7.6% vs +5.3% y/y prior
- Japan unlikely to intervene to stem yen decline, says former currency chief Shinohara
- BOJ conducts emergency market operation, offers to buy ¥100 billion in 10-25 year JGBs
- BOJ's Kuroda says did not discuss anything in particular on FX with PM Kishida
- US MBA mortgage applications w.e. 25 March -6.8% vs -8.1% prior
Markets:
- JPY leads, USD lags on the day
- European equities lower; S&P 500 futures down 0.2%
- US 10-year yields flat at 2.40%
- Gold up 0.3% to $1,924
- WTI up 2.4% to $106.70
- Bitcoin down 0.3% to $47,325
There was some decent movement in European morning trade, with the dollar struggling across the board as the bond market rout takes a bit of a breather.
The greenback is weighed lower initially against the yen but saw losses become more widespread with EUR/USD hitting a four-week high of 1.1160 from around 1.1100 earlier in the day.
USD/JPY continues to be weighed lower as the retreat from 125.00 continues. The pair is seen down around 1% to 121.60, ranging between that and 121.90 during the session.
Meanwhile, GBP/USD managed to claw its way back higher from 1.3120 to 1.3160 while AUD/USD kept firmer around 0.7520-30 levels as buyers look to try and keep above the 0.7500 handle.
The key highlight in Europe was arguably the Spanish and German states' inflation releases, which signaled a brutal surge in prices for the month of March. That will be wrapped up by the German national reading later at the top of the hour, which should comfortably be above 7%.
The data did contribute to a more aggressive ECB market pricing, which perhaps provided some tailwind for the euro.
Elsewhere, equities are looking more sluggish with German stocks weighed down after warnings about gas rationing with a standoff seen between Europe and Russia on supply payments. The bond market rout is taking a bit of a breather but it hardly is hinting at anything after the moves seen in the past few weeks.