Following yesterday, there are no significant economic indicators scheduled for release today. The market’s focus is on tomorrow’s US Consumer Price Index.
Last week’s sharp decline in US regional bank stocks, which had disrupted the market, has shown signs of rebounding at the beginning of this week, indicating a temporary stabilization. Furthermore, the market reacted positively to the strong results of the US employment statistics released over the weekend, which indicate a solid economic trend. However, yesterday’s US Federal Reserve survey showed that banks are tightening their lending standards. With the major event of the US Consumer Price Index announcement tomorrow, today’s overseas markets are expected to be driven by adjustments.
In the foreign exchange market, due to a pause in rising oil prices, there are signs of adjustment selling in the Norwegian krone, Australian dollar, and New Zealand dollar, which had been bought in a risk-on environment. Cross yen pairs are also struggling to move higher. The USD/JPY is seeing mixed trading, but the momentum for further gains seems to have calmed down.
Later in the overseas markets, economic indicators to be released include the French trade balance (March) and current account balance (March), as well as the Mexican Consumer Price Index (CPI) (April). The market’s focus will be limited to these less influential indicators. In the indicators released today, the April UK BRC like-for-like retail sales were up 5.2% year-on-year, higher than the 4.9% increase in March. It will be interesting to see if London traders react to this data.
On the other hand, there are many scheduled speech events. A series of speeches and event participations are planned by ECB officials, including Herodotu, the Governor of the Central Bank of Cyprus, Lane, ECB Chief Economist, Centeno, Governor of the Bank of Portugal, Vasle, Governor of the Bank of Slovenia, Vujcic, Governor of the Croatian Central Bank, and Schnabel, ECB Executive Board member. US financial authorities, such as Jefferson, a Federal Reserve Board member, and Williams, the President of the New York Fed, are also scheduled to speak. In addition to their views on monetary policy, any comments on the recent US regional bank issue will be closely watched. As for the concerning US debt ceiling, President Biden is scheduled to discuss the matter with Republican House Minority Leader McCarthy and others.
Currently, with the buying of JPY and GOLD spreading again, the market seems to be leaning towards financial concerns stemming from the US regional banks, similar to the situation with athletes. However, considering tomorrow’s US CPI, it is assumed that it would be difficult for a significant trend to emerge. The USD selling bias is expected to continue.