 Dollar remains firm in Asian session after the strong post-CPI rally. US stocks were deeply sold off as a June Fed rate cut is further priced out by the markets. Market attention is now keenly focused on the upcoming PPI for March, as well as University of Michigan's consumer survey results. Should today's PPI data reveal strong figures, followed by heightened consumer inflation expectations tomorrow, it could further delay the Fed's anticipated rate reduction timeline, thereby reinforcing the Dollar's strength. In Europe, the financial markets are braced for ECB rate decision, with broad consensus anticipating the main refinancing rate to hold steady at 4.50%. ECB has communicated clearly its conditional plan to initiate rate cuts by June, dependent on the first-quarter wage data due in May. By then, new economic projections will be available too to guide monetary policy decision. It's unlikely that ECB will depart from its cautious stance at this juncture. President Christine Lagarde would continue to emphasize a data-dependent approach and reaffirm the meeting-by-meeting decisions. Today's announcement and subsequent press conference are anticipated to have minimal impact on the markets. |
