Did anyone notice Oil yesterday? It broke above a key resistance at $85 a barrel in the front month. We are over a quarter into a 2024 and we were promised rapid rate cuts but, so far, only the Swiss have been forthcoming. Yesterday, the Fed’s Daly underlined she still sees 3 cuts this year, even if “a projection is not a promise,” and the same tone is heard from all the Fed officials. The market views are not crystal clear, Bloomberg echoed sentiment that a 60% Trump China tariff and a 10% universal tariff could reduce US GDP by 0.5% but push the PCE deflator to 3.7% by end-2025, can the Fed then still cut? The yield on 10-year Treasuries was little changed at 4.36%.
Overnight, Caixin services PMI for China was 52.7, and the Jibun services PMI for Japan was 51.7. As for the day ahead, we see Eurozone CPI, with expectations of 0.9% m-o-m, but the core reading to fall a tick to 3% y-o-y. We also get Eurozone unemployment figures for February. The expectation is unchanged at 6.4%. Then we have ADP employment in the US, seen 150K, and the US services PMI and the ISM services reports.
Central bank speakers include De Cos from the ECB, and Bostic, Powell, Bowman, Goolsbee, Barr and Kugler from the Fed.
Marketwise Spot gold rose 0.1% to $2,283.32 an ounce, Bitcoin rose 0.7% to $66,143.2, Ether rose 1.2% to $3,312.41. USDJPY opens at 151.65, Cable at 1.2570 - still below that 200 day moving average and EURUSD at 1.0770.
