Financial Markets Daily Report 04 abril 2024
Investors traded cautiously during yesterday’s session as they digested a mixed bag of economic data releases. Euro area March inflation cooled to 2.4% y/y from 2.6%, slightly below consensus. In the US, the ISM services index surprised to the downside by falling to 51.4, down from 52.6 in February, while the ADP employment report surprised to the upside.
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- Investors traded cautiously during yesterday’s session as they digested a mixed bag of economic data releases. Euro area March inflation cooled to 2.4% y/y from 2.6%, slightly below consensus. In the US, the ISM services index surprised to the downside by falling to 51.4, down from 52.6 in February, while the ADP employment report surprised to the upside.
- Central bank officials also sent mixed signals. From the Fed, Powell continued to focus on the importance of data-dependency, Bostic directly said rates should not be cut until the fourth quarter, while Mester pointed to the summer as the most likely start date. From the ECB, De Cos kept June as the most probable month for the first interest rate cut.
- In this context, sovereign bond yields were mostly flat across the board, pausing after two days of gains, and equities edged slightly higher. The euro gained against the US dollar, trading around the $1.08 mark, while the yen continued to weaken. Commodities extended their rally, with Brent now touching $89.5/barrel.