Financial Markets Daily Report13 April 2023
Investors continued to err on the side of caution on Wednesday, balancing out data showing US inflation cooled slightly more than expected in March with warnings set out in the minutes of the last Fed meeting of the risk of a mild recession in the US later this year.
- Investors continued to err on the side of caution on Wednesday, balancing out data showing US inflation cooled slightly more than expected in March with warnings set out in the minutes of the last Fed meeting of the risk of a mild recession in the US later this year.
- In particular, headline CPI rose by 0.1% m/m and 5.0% y/y (0.4% m/m and 6.0% y/y in February), reaching the lowest annual pace since May 2021. Excluding food and energy, CPI rose by 0.4% m/m (0.5% m/m in February), with tentative signs of price moderation in the sticky shelter component.
- The data fueled gains across equity markets in the US, which, however, reverted after the release of the Fed minutes. In Europe, both equity indices and sovereign bond yields picked up. In addition, the USD depreciated against peers, nearing the 1.10 level against the EUR. Today, the focus turns to the accounts of the last ECB meeting.