Euro Edges Lower Despite Positive Inflation Report

The euro has posted slight losses on Friday. EUR/USD is down 0.28%, trading at 1.0837 in the North American session at the time of writing.

Sunset Market Commentary

Several ECB policymakers hit the wires today, including Holzmann, de Guindos and heavyweight Schnabel. As a loyal hawk it was no surprise for Holzmann to caution against easing before the central bank is certain of inflation’s return to 2%. De Guindos stuck to the official guidance of a June cut without committing to anything beyond.

Week Ahead – Flash PMIs, UK & Japan CPIs in Focus; RBNZ to Hold Rates

Inflation data will dominate the economic agenda once again in the coming week as CPI numbers are due in Canada, Japan and the United Kingdom. The Canadian figures are up first on Tuesday. Prior to that, it will be an unusually quiet start to the week as several markets will be closed on Monday.

Canadian Inflation Prints to Show Another Step Down in April

Next week’s Canadian April inflation report will be the last major data release before the Bank of Canada’s next interest rate decision on June 5th. Absent an upside surprise, we think the soft conditions in the economy and labour markets should warrant a 25-bps interest rate cut from the BoC in June.

Weekly Economic & Financial Commentary: Fed Rate Cuts Back on the Table?

Market participants have significantly dialed back their expectations of the total amount of Fed easing this year, but recent data keep a 25 bps rate cut at the September meeting in play.

The Weekly Bottom Line: Inflation Breaks Its Heat Streak

A combination of data releases this week pointed to a cooling U.S. economy. Retail sales were weak, and inflation slowed, which revived hopes of a Fed rate cut sooner rather than later. Markets responded to the news with the S&P 500 edging higher (up 1.4% relative to last Friday’s close) and 10-year Treasury yield easing (down 9 basis points), at the time of writing.

Forex and Cryptocurrency Forecast

The American currency suffered two significant blows last week. Although these were not knockdowns, let alone knockouts, these minor shocks pushed the DXY Dollar Index down from 105.26 to 104.20 points, and EUR/USD up from 1.0766 to 1.0895.

Westpac New Zealand RBNZ Pulse Client Survey

Ahead of this week’s RBNZ policy meeting, our survey finds that offshore clients are more dovish than those onshore. Both groups are more dovish than the RBNZ.

Could RBNZ Support Kiwi’s Recent Strength?

The Reserve Bank of New Zealand will announce its interest rate decision on Wednesday at 02:00 GMT with the press conference following one hour later. The market is overwhelmingly expecting no change in the cash rate as it is currently assigning just a 2% probability of a 25bps rate cut.

Pound Shrugs After BoE's Broadbent Signals Rate cut

The British pound is almost unchanged on Monday. GBP/USD is trading at 1.2704 in the European session at the time of writing.