Financial Markets Daily Report01 March 2024
US January PCE deflator came in line with expectations (2.4% yoy down from 2.6% the previous month), and euro area countries’ CPI did not surprise either (Germany: 2.5% yoy, France: 2.9% yoy, Spain: 2.8% yoy), boosting markets’ expectations of a first interest rate cut starting in June and July.
- US January PCE deflator came in line with expectations (2.4% yoy down from 2.6% the previous month), and euro area countries’ CPI did not surprise either (Germany: 2.5% yoy, France: 2.9% yoy, Spain: 2.8% yoy), boosting markets’ expectations of a first interest rate cut starting in June and July.
- The lack of surprises in inflation data resulted in a session without large movements. Euro area sovereign bond yields rose modestly and were barely changed in the US. Equities were mixed, posting some losses in the euro area and gains in US markets, with the Nasdaq index reaching a new all-time high.
- Elsewhere, Chinese equities powered ahead amid new measures from the government to support markets. The US dollar rose slightly, leaving its cross with the euro around $1.08. Today all eyes will be on the euro area’s February CPI report and the US February ISM indices. Spain’s manufacturing PMI will also be released today.