- ECB’s Noyer: Tentative signs economy has become “less bad” in recent weeks, but situation still very unclear. Small amount of room to cut rates. Deflation not big risk.
- UK March CPI +0.2% m/m, +2.9% y/y, exactly in line with median forecasts. Annual rise weakest since March 2008.
- UK March RPI flat m/m, -0.4% y/y, vs median forecasts of -0.2% m/m, -0.5% y/y. First negative annual read since 1960.
- ZEW institute April German economic sentiment index 13.0 vs -3.5 in March, much better than median forecast of 1.5 and first time since July 2007 that headline index in positive territory
- BOE’s Sentance: Data since February consistent with slight improvement in economy later this year
Risk sentiment very marginally improved this morning, with US stock futures and European stockmarkets eeking out gains. This has benefitted the euro and sterling.
EUR/USD also got a lift from better than expected ZEW data. April German economic sentiment index came in at 13.0 vs -3.5 in March, first time since July 2007 that headline index in positive territory.
Cable rallied nicely after an early sell-0ff hitting a session high 1.4606 before steadying. The pairing was helped by market talk that British Petroleum had to buy cable for “dividend purposes” at the 11.00 fix. The pairing got a further boost from the better than expected ZEW data. Talk of sell orders at 1.4610 up through 1.4650 has so far helped contain gains.
USD/JPY very quiet, once again effectively sidelined.
