EU inflation data yet to show signs of stabilization

Notes/Observations

- Risk appetite finds fresh legs after pledge by China’s Politburo to boost economic support.

- Euro Area Q1 GDP (Beats: none Misses: France, Spain; in-line: Euro Zone Germany, Italy); Germany avoids a technical recession.

- Euro Zone inflation yet to show signs of any stabilization; EU reading’s annual pace matched the record high since Euro's launch (Higher: France, Austria, and Portugal; in-line: Euro Zone).

Asia

- China Politburo stated that would prevent 'black swan' and 'grey rhino' events; Reiterated stance that domestic economy was facing increasing uncertainties and complexities; striving to attain full year social and economic targets.

- China Govt: would not change zero covid policy and to optimize response.

- China and US said to be negotiating on site auditing checks.

- South Korea Mar Industrial Production M/M: +1.3% v -0.5%e v +0.6% prior; Y/Y: 3.7% v 4.0%e.

- Australia Q1 PPI Q/Q: 1.6% v 1.3% prior; Y/Y: 4.9% v 3.7% prior.

Russia/Ukraine

- President Biden said to ask Congress to approve $33B in military/economic/humanitarian aid for Ukraine. (Note: US seen preparing for the conflict to intensify and last longer).

Americas

- President Biden stated that was looking at additional forgiveness of student loans, not to exceed $50K; to discuss loan forgiveness in the next few weeks.

Speakers/Fixed income/FX/Commodities/Erratum

Equities

Indices [Stoxx600 +1.02% at 451.64, FTSE +0.33% at 7,533.98, DAX +1.28% at 14,159.10, CAC-40 +1.25% at 6,589.66, IBEX-35 +0.69% at 8,570.95, FTSE MIB +0.96% at 24,286.00, SMI +0.76% at 12,160.38, S&P 500 Futures -0.51%].

Market Focal Points/Key Themes: European indices open higher across the board and advanced into the green as the session progressed; improved risk sentiment attributed to lower geopolitical tensions after EC says payments in rubles don’t violate sanctions; sectors among those leading to the upside are materials and technology; underperforming sectors include real estate and utilities; Plastic Ominum to acquire Varroc Lighting; Sampo divests its stake in Nordea; focus on US economic data later in the day cinluding PCE deflator, PMIs and ECI; earnings expected during the upcoming US session include ExxonMobile, Abbvie, Honeywell and Coglate-Palmolive.

Equities

- Consumer discretionary: Remy Cointreau [RCO.FR] +3.5% (sales).

- Energy: Eni [ENI.IT] +1% (earnings).

- Financials: BBVA [BBVA.ES] +4.5% (earnings), NatWest [NWG.UK] -2% (earnings).

- Healthcare: AstraZeneca [AZN.UK] -0.5% (earnings).

- Industrials: BASF [BASF.DE] +0.5% (earnings), Safran [SAF.FR] +0.5% (earnings), Danske Bank [DANSKE.DK] -4% (earnings), Henkel [HEN.DE] -7% (earnings; cuts outlook).

Speakers

- Euro Zone Finance Ministers (Eurogroup) said to target a joint deposit guarantee fund by 2024. To discuss deposit-fund on Tuesday, May 3rd and look to win over some of the skeptics like Germany.

- SNB President Jordan reiterated view that domestic inflation was seen as moderate and likely to decline in foreseeable future.

- Spain Economy Ministry updated economic outlook cut its 2022 GDP growth forecast from 7.0% to 4.3%.

- Russia said to have offered India duel payment for oil and other trade items. Russia would seek USD payment for oil and RUB currency (ruble) or INR (rupee) for other trade items.

- Indonesia President Jokowi stated that had invited Ukraine President to attend G20-Summit; says Russia's President Putin plans to attend.

- China said to end regulatory scrutiny over big tech and give sector a bigger role in boosting slowing economy.

Currencies/Fixed income

- USD edged off from recent multi-year highs against various currencies 20-year high on Friday but still within sight of its best monthly gain in a decade. Greenback’s recent strength being attributed to a favorable widening divergence in the Fed’s monetary policy. The USD retracement due to rising risk appetite after pledge by China’s Politburo to boost its economic support.

Economic data

- (NL) Netherlands Mar Retail Sales Y/Y: 9.8% v 16.5% prior.

- (FI) Finland Mar Preliminary Retail Sales Volume Y/Y: -1.7% v -0.3% prior.

- (FR) France Q1 Preliminary GDP Q/Q: 0.0% v 0.3%e; Y/Y: 5.3% v 5.5%e.

- (FR) France Mar Consumer Spending M/M: -1.3% v -0.2%e; Y/Y: -2.4% v -2.3% prior.

- (DE) Germany Mar Import Price Index M/M: 5.7% v 3.4%e; Y/Y: 31.2% v 28.6%e.

- (UK) Apr Nationwide House Price Index M/M: 0.3% v 0.8%e; Y/Y: 12.1% v 12.6%e.

- (FI) Finland Feb Final Trade Balance: -€1.1B v -€1.1B prelim.

- (ZA) South Africa Mar M3 Money Supply Y/Y: 8.4% v 6.4% prior; Private Sector Credit Y/Y: 5.9% v 5.4%e.

- (SE) Sweden Mar Household Lending Y/Y: 6.8% v 6.7% prior.

- (SE) Sweden Feb Non-Manual Workers Wages Y/Y: 2.2% v 2.2% prior.

- (NO) Norway Mar Retail Sales (incudes auto/fuel) M/M: +3.3% v -1.1% prior.

- (NO) Norway Mar Credit Indicator Growth Y/Y: 5.0% v 5.0% prior.

- (DK) Denmark Mar Unemployment Rate: 2.1% v 2.2% prior; Gross Unemployment Rate: 2.5% v 2.5% prior.

- (CH) Swiss Mar Real Retail Sales M/M: -6.6 v +12.5% prior.

- (FR) France Apr Preliminary CPI M/M: 0.4% v 0.2%e; Y/Y: 4.8% v 4.6%e.

- (FR) France Apr Preliminary CPI EU Harmonized M/M: 0.5% v 0.2%e; Y/Y: 5.4% v 5.1%e.

- (FR) France Mar PPI M/M: 4.3% v 0.9% prior; Y/Y: 26.5% v 22.4% prior.

- (ES) Spain Q1 Preliminary GDP Q/Q: 0.3% v 0.6%e; Y/Y: 6.4% v 6.7%e.

- (ES) Spain Mar Adjusted Retail Sales Y/Y: -4.2% v +1.4%e; Retail Sales (unadj) Y/Y: -5.5% v +1.7% prior.

- (CH) Swiss Apr KOF Leading Indicator: 101.7 v 98.9e.

- (AT) Austria Q1 GDP Q/Q: +2.5% v -1.5% prior; Y/Y: 8.7% v 5.6% prior.

- (AT) Austria Apr Preliminary CPI M/M: 0.3% v 2.1% prior; Y/Y: 7.2% v 6.8% prior.

- (AT) Austria Mar PPI M/M: 2.8% v 1.2% prior; Y/Y: 21.2% v 18.9% prior.

- (CZ) Czech Q1 Advance GDP (1st reading) Q/Q: 0.7% v 0.4%e; Y/Y: 4.6% v 4.3%e.

- (TR) Turkey Mar Trade Balance: -$8.2B v -$8.2Be.

- (TH) Thailand Mar Current Account Balance: +$1.3B v -$0.4Be; Overall Balance of Payments (BOP): $0.9B v $2.8B prior; Trade Account Balance: $5.2B v $3.4B prior; Exports Y/Y: 18.9% v 16.0% prior; Imports Y/Y: 16.7% v 14.2% prior.

- (CN) Weekly Shanghai copper inventories (SHFE): 48.4K v 69.9K tons prior.

- 04:00 (EU) Euro Zone Mar M3 Money Supply Y/Y: 6.3% v 6.2%e.

- (DE) Germany Q1 Preliminary GDP Q/Q: 0.2% v 0.2%e; Y/Y: 3.7% v 3.6%e; GDP NSA (unadj) Y/Y: 4.0% v 3.7%e.

- (ES) Spain Feb Current Account Balance: +€0.2B v -€2.6B prior.

- (IT) Italy Q1 Preliminary GDP Q/Q: -0.2% v -0.2%e; Y/Y: 5.8% v 5.8%e.

- (NO) Norway Central Bank (Norges) May Daily FX Purchases (NOK): 2.0B v 2.0Be.

- (NO) Norway Apr Unemployment Rate: 1.9% v 1.9%e.

- (PL) Poland Apr Preliminary CPI M/M: 2.0% v 1.3%e; Y/Y: 12.2% v 11.4%e (highest annual pace since 2002).

- (RU) Russia Narrow Money Supply w/e Apr 22nd (RUB): 14.50T v 14.64T prior.

- (CZ) Czech Mar M2 Money Supply Y/Y: 5.9% v 6.1% prior.

- (TR) Turkey Mar Foreign Tourist Arrivals Y/Y: 129.7% v 186.5% prior.

- (PT) Portugal Q1 Preliminary GDP Q/Q: 2.6% v 0.3%e; Y/Y: 11.9% v 5.9% prior.

- (PT) Portugal Apr Preliminary CPI M/M: 2.2% v 2.5% prior; Y/Y: 7.2% v 5.3% prior.

- (PT) Portugal Apr Preliminary CPI EU Harmonized M/M: 2.4% v 2.6% prior; Y/Y: 7.4% v 5.5% prior.

- (EU) Euro Zone Apr Advance CPI Estimate Y/Y: 7.5% v 7.5%e; CPI Core Y/Y: 3.5% v 3.2%e.

- (EU) Euro Zone Q1 Advance GDP Q/Q: 0.2% v 0.3%e; Y/Y: 5.0% v 5.0%e.

- (IT) Italy Apr Preliminary CPI M/M: 0.2% v 0.4%e; Y/Y: 6.2% v 6.4%e.

- 00 (IT) Italy Apr Preliminary CPI EU Harmonized M/M: 0.6% v 1.0%e; Y/Y: 6.6% v 6.5%e.

- (GR) Greece Feb Retail Sales Value YoY: 10.8% v 8.5% prior; Retail Sales Volume YoY: 16.8% v 13.9% prior.

- (IS) Iceland Mar Final Trade Balance (ISK): -13.1B v -11.4B prelim.

Fixed income issuance

- (IN) India sold total INR330B vs. INR330B indicated in 2023, 2029, 2032 and 2061 bonds.

- (IT) Italy Debt Agency (Tesoro) sells total €6.5B vs. €5.5-6.5B indicated range in 5-year and 10-year Bonds.

- Sold €2.5B vs. €2.0-2.5B indicated range in 1.10% Apr 2027 BTP bonds; Avg Yield: 1.91% v 1.46% prior; Bid-to-cover: 1.49x v 1.38x prior.

- Sold €4.0B vs. €3.5-4.0B indicated range in new 2.50% Dec 2032 BTP; Avg Yield: 2.78% v 2.14% prior; bid-to-cover: 1.34x v 1.31x prior.

- (IT) Italy Debt Agency (Tesoro) sold €1.5B vs. €1.0-1.5B indicated range in Oct 2030 Floating Rate Note (CCTeu); Avg Yield: 0.50% v 0.08%prior; Bid-to-cover: 1.76x v 1.63x prior.

Looking ahead

- 05:25 (EU) Daily ECB Liquidity Stats.

- 05:30 (SL) Sri Lanka Apr CPI Y/Y: No est v 18.7% prior.

- 06:00 (IT) Italy Mar PPI M/M: No est v 0.2% prior; Y/Y: No est v 41.4% prior.

- 06:00 (PT) Portugal Mar Retail Sales M/M: No est v 2.2% prior; Y/Y: No est v 13.9% prior.

- 06:00 (UK) DMO to sell £3.5B in 1-month, 3-month and 6-month bills (£1.0B, £1.0B and £1.5B respectively).

- 06:30 (RU) Russia Central Bank (CBR) Interest Rate Decision: Expected cut Key 1-Week Auction Rate by 200bps to 15.00%.

- 06:45 (US) Daily Libor Fixing.

- 07:00 (IN) India announces upcoming bill issuance (held on Wed).

- 07:00 (MX) Mexico Q1 Preliminary GDP Q/Q: 1.0%e v 0.0% prior; Y/Y: 1.6%e v 1.1% prior.

- 07:00 (MX) Mexico Feb Gold Production: No est v 7.2K kilograms; Silver Production: No est v 334.5K kilograms; Copper Production: No est v 38.6K tons prior.

- 07:30 (IN) India Weekly Forex Reserve w/e Apr 22nd: No est v $B prior.

- 08:00 (IN) India Mar Eight Infrastructure (key) Industries: No est v 5.8% prior.

- 08:00 (ZA) South Africa Mar Trade Balance (ZAR): 22.0Be v 1.6B prior.

- 08:00 (ZA) South Africa Mar Monthly Budget Balance (ZAR): -30.5Be v -3.4B prior.

- 08:00 (BR) Brazil Mar National Unemployment Rate: 11.4%e v 11.2% prior.

- 08:00 (UK) Daily Baltic Dry Bulk Index.

- 08:00 (ES) Spain Debt Agency (Tesoro) size announcement for upcoming issuance.

- 08:30 (US) Q1 Employment Cost Index (ECI): 1.1%e v 1.0% prior.

- 08:30 (US) Mar Personal Income: 0.4%e v 0.5% prior; Personal Spending: 0.6%e v 0.2% prior; Real Personal Spending (PCE): -0.1%e v -0.4% prior.

- 08:30 (US) Mar PCE Deflator M/M: 0.9%e v 0.6% prior; Y/Y: 6.7%e v 6.4% prior.

- 08:30 (US) Mar PCE Core Deflator M/M: 0.3%e v 0.4% prior; Y/Y: 5.3%e v 5.4% prior.

- 08:30 (CA) Canada Feb GDP M/M: 0.8%e v 0.2% prior; Y/Y: 4.1%e v 3.5% prior.

- 08:30 (BR) Brazil Mar Current Account Balance: -$1.4Be v -$8.2B prior; Foreign Direct Investment (FDI): $10.0Be v $4.7B prior.

- 09:00 (CL) Chile Mar Manufacturing Production Y/Y: -3.0%e v -2.2% prior; Industrial Production Y/Y: -3.9%e v -3.0% prior; Total Copper Production: No est v 399.8K tons prior.

- 09:00 (CL) Chile Mar Retail Sales Y/Y: 10.6%e v 11.1% prior; Commercial Activity Y/Y: No est v 4.8% prior.

- 09:45 (US) Apr Chicago Purchase Managers’ Index (PMI): 62.0e v 62.9 prior.

- 10:00 (US) Apr Final University of Michigan Confidence: 65.7e v 65.7 prelim.

- 10:00 (MX) Mexico Mar Net Outstanding Loans (MXN): No est v 4.846T prior.

- 11:00 (CO) Colombia Mar National Unemployment Rate: No est v 12.9% prior; Urban Unemployment Rate: 12.0%e v 12.7% prior.

- 11:00 (EU) Potential sovereign ratings after European close.

- 13:00 (US) Weekly Baker Hughes Rig Count.

- 14:00 (CO) Colombia Central Bank Interest Rate Decision: Expected to raise Overnight Lending Rate by 100bps to 6.00%.

- 15:00 (AR) Argentina Feb Wages M/M: No est v 3.8% prior.

- 21:30 (CN) China Apr Manufacturing PMI (Govt Official): 48.0e v 49.5 prior; Non-manufacturing PMI: 46.7e v 48.4 prior; Composite PMI: No est v 48.8 prior.

- 21:45 (CN) China Apr Caixin PMI Manufacturing: 47.0e v 48.1 prior.