US: Spending Remains Steady, PCE Deflator Trends Lower in March

Personal income grew 0.3% month-on-month (m/m) in March, equal to February's growth and above market expectations for a more modest 0.2% m/m gain. Compensation of employees (+0.3% m/m) accounted for most of the growth, in addition to upticks in dividend and rental income.

Canada's Economy Continues to Grow in February, Points to a Slight Decline in March 

Canadian growth continues to exhibit strength. With today's print and the flash estimate for March, first quarter GDP is tracking at an annualized rate of 2.5%. This is broadly aligned with the Bank of Canada's most recent 2.3% estimate for Q1 growth.

RBA Could Opt for a Stronger Aussie at Tuesday's Rate Decision

It is the start of a new month and time for another RBA rate-setting meeting. While this is expected to be overshadowed by the week’s other key central meetings, the market remains extremely interested in the RBA’s assessment of the economic developments in the wider region. The week also includes some noteworthy data releases and the quarterly Statement of Monetary Policy. Can the aussie bulls count on the RBA for assistance to engineer an upleg in the aussie/yen pair? 

Will the Fed Hike Rates for the Last Time?

On Wednesday, the FOMC is widely anticipated to deliver its last rate hike for this tightening cycle. However, with inflation staying well above the Committee’s target and underlying price pressures proving stickier than expected, will policymakers feel comfortable to signal that they are done? Or will they keep the door to more hikes open? And how may the dollar react?

Week Ahead – Fed and ECB Decisions Set the Stage for US Payrolls

An explosive week lies ahead for global markets, featuring central bank decisions in the United States, Eurozone, and Australia, alongside the latest edition of nonfarm payrolls. The Fed is expected to raise interest rates one final time, so the dollar will react mostly to any signals around future action. But the euro might enjoy even greater volatility, as traders are split on the size of the upcoming ECB rate increase.  

Week Ahead – Brace Yourself (Fed, ECB, NFP, Peak Earnings)

This week will be extremely busy as we have an FOMC decision, the nonfarm payroll report, peak earnings season, all while Wall Street keeps an eye on the banking industry to see if any news stresses arise.  The FOMC meeting is expected to have policymakers deliver one more quarter-point rate rise, possibly leaving the door open for one more. Disinflation trends need to show they are firmly entrenched for the Fed to take their foot off the tightening pedals.

Weekly Economic & Financial Commentary: Eurozone Avoids Recession, Bank of Japan Keeps Policy Unchanged

The Eurozone's Q1 GDP data revealed that the economy narrowly avoided recession to start the year, with the economy expanding 0.1% quarter-over-quarter in Q1 after contracting 0.1% in Q4-2022. Elsewhere, the Bank of Japan (BoJ) held its first monetary policy meeting under Governor Ueda and decided unanimously to keep policy settings unchanged. While Ueda's commentary leaned dovish, he did not rule out the possibility of an eventual shift in policy.

Canadian Dollar Edges Lower ahead of US, Canadian Mfg. PMIs

The week kicks off with Manufacturing PMIs on both sides of the border. The manufacturing sector continues to struggle across the globe, and Canada and the US are no exception. Canada’s PMI is expected to rise in April from 48.6 to 50.5, which would point to stagnation. In the US, manufacturing has declined for five straight months, with readings below the 50.0 level. The estimate for April stands at 46.6, following 46.3 in March.

Oil Has Closed the Gap But Ready to Go Lower

WTI oil stabilises near $75 for the third day at the lowest monthly level. The economic slowdown is dragging down the Crude, but OPEC+ coordination supports the market. Oil has returned to a range from which an exit promises to have a dam-breaking effect.

Cryptocurrencies Rock the Thin Market

According to CoinMarketCap, cryptocurrency market capitalisation grew by 2.5% over the past seven days to $1.18 trillion, but the magnitude of the increase was twice greater on Sunday. The pressure on the market resumed last night and peaked on Monday morning. And it looks like Bitcoin is again behind this decline as its price approaches 30K.