UK CPI amongst market movers for today - Rabobank

Analysts at Rabobank explain that today we’ve already seen Japanese trade data, where exports were up 2.1% y-o-y vs. consensus of 5.2%, and imports fell -0.6% vs. a consensus 6.3% rise; the trade surplus was thus larger than expected, but not in a healthy way.

Key Quotes

“Next up today it’s UK CPI, which is likely to remain 2.77% y-o-y headline and 0.3% m-o-m, while core y-o-y CPI is seen edging up from 2.4% to 2.5%. Looking at that from a long way away, apart from looming Brexit, can somebody please explain why the BoE still has rates of 0.50%? Perhaps that thought it also on Mr. Market’s mind as GBP/USD rises to flirt with 1.43.”

“In the Eurozone we get flash March CPI too, where the y-o-y rate is expected at 1.4% vs. a revised 1.1% and the core figure consensus is an unchanged 1.0% y-o-y. Given that the Euro growth cycle may already be turning significantly lower, or at least the ZEW survey backs the preliminary circumstantial evidence that this might soon be the case, looking at that from a long way away, can somebody please explain why the ECB is set to tighten policy?”