Another Dip in Crypto Capitalization

The crypto market capitalisation decreased by another 1.5% to $2.27 trillion, getting closer and closer to the April lows just above $2.22 trillion. Contrary to expectations, after the halving, the pressure on the market increased, in full accordance with the adage “buy the rumour, sell the news”.

Canada's Economy Continued to Grow in February, No Growth Expected in March

The Canadian economy continued to grow into February, but at a slightly slower speed after January's downwardly revised print and February's downside miss. Still, with today's print and next month's guidance, first quarter GDP is tracking a healthy 2.5% q/q annualized, in line with the Bank of Canada and our estimates.

NZ First Impressions: Labour Market Surveys, Q1 2024

Overall, we suspect this doesn’t change the picture that much for the RBNZ. There will be relief that the broad path for the labour market seems intact, which will be required to reduce the ongoing domestic inflation pressures that remained clearly evident in the March quarter CPI report.

Sunset Market Commentary

EMU PMI’s confirmed the economy is gradually leaving contraction/stagnation territory that reigned in in the second half of last year and during the first months of 2024. The composite output index rose from 50.3 in March to 51.4 in April, the second consecutive reading >50 after 9 months in contraction territory and the best level since May last year.

Slow Grind on Disinflation, RBA on Hold

Inflation was a bit higher than expected in the March quarter. It is declining, but it has a way to go for the RBA to be confident of returning to the 2–3% target range on the desired timetable. We expect the Board to keep rates on hold in May, and have pushed out the date of the first rate cut to November this year, previously September.

Stubbornly High Inflation Doesn't Allow RBA to Cut Interest Rates Anytime Soon

Stubbornly high inflation, especially for the likes of services/non-tradeable goods, doesn’t allow the RBA to cut interest rates anytime soon. Australian yields jumped higher this morning with the 3-y government bond yield adding 17 bps (to 4.01%). Markets now see only a small chance (< 30%) for a fist rate cut by the end of the year. The prospect for protracted interest rate support also propelled the Aussie dollar with AUD/USD regaining the 0.65 mark (0.652).

Altcoins Upbeat, Bitcoin Hesitant to Breakout

The crypto market added 0.5% in 24 hours to $2.46 trillion as a rebound in risk appetite in stocks helped altcoins attract buying interest. The Crypto Fear & Greed Index added 1 point to 72 (Greed).

Euro Edges Lower Despite Stronger German Business Confidence

Germany’s Ifo Business Climate index rose to 89.4 in April, up from a revised 87.9 in March and above the market estimate of 88.9. The index is still in negative territory (100 separates pessimism from optimism) but there are signs of optimism that the eurozone’s largest economy may have bottomed out.

Will BoJ Disappoint Once Again?

The Bank of Japan (BoJ) is very likely to keep interest rates untouched on Friday following a historic decision last month to take borrowing costs out of negative territory and to abolish its yield curve control policy.

AUD/USD Extends Gains as Inflation Higher Than Expected

The Australian dollar has edged higher on Wednesday. In the European session, AUD/USD is trading at 0.6504, up 0.27%. The Australian dollar rose as high as 0.6529 (0.64%) after the Australian inflation release but has pared about half of those gains.