From Marc to Market:
Overview: The dollar is mixed as the market awaits the US personal consumption expenditure deflator, which is the measure of inflation the Fed targets. While there is headline risk, we argue that the signal has already been generated by the CPI and PPI releases. The yen is the strongest of the G10 currencies, up nearly 0.5%. The market shrugged off weak data that spurs speculation of a third quarterly contraction and focused on the comments from a BOJ board member that were consistent with the exit from negative interest rates in the coming months. Meanwhile, the Australian and New Zealand dollars remain fragile after yesterday's drubbing. Most emerging market currencies are firmer today, led by the Malaysian ringgit, where officials are threatening to intervene.
Asia Pacific equities were mixed, including in Japan where the Topix edged higher, but the Nikkei slipped. Mainland Chinese stocks rose with the CSI 300 up almost 2%. However, Chinese companies that trade in Hong Kong fell by about 0.2%. South Korea and Taiwan went in opposite directions as did Australia and New Zealand. Europe's Stoxx 600 is slightly firmer after falling by 0.35% yesterday. US index futures are trading softer. Bonds are selling off. European benchmark 10-year yields are 4-6 bp higher. The 10-year US Treasury yield is up four basis points to nearly 4.31%. Gold is a little softer but within yesterday's range (~$2024-$2038). April WTI is flattish near $78.50....
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