1️⃣ Inflation is not enough to motivate FED to act, the market leaves USD
- The dollar weakened at the beginning of the European session on Wednesday, being pushed to a three-week low as bond yields fell after US inflation rose in March deemed not enough to change the Fed's mindset. .
Yields on 10-year US Treasury bonds fell to 1,620%, far from their peak of 1.78% at the end of March.
The US consumer price index rose 0.6% on a monthly basis - the largest increase since August 2012, and up 2.6% - on a year-on-year basis.
While these numbers are higher than the expectations of forecasts, there is a part of the market that expects inflation to intensify due to pent-up demand, massive fiscal stimulus, and immunization programs. success.
- Fed officials have also repeatedly stated that they will treat all price pressures in the short term as temporary and this CPI data does not put pressure on the Fed to think about easing loose monetary policies. sneak.
2️⃣ European Commission (EC) becomes the largest debt issuer
The European Commission plans to borrow around 150 billion euros a year until 2026 to fund the bloc's unprecedented stimulus plan to digitize the economy and make it greener. This makes them the biggest debt issuer in euros.
- The amount in the EC economic plan has been agreed at 750 billion EUR in 2018 but now it has increased to about 807 billion EUR.
- This amount is divided into 338 billion grant grants and 386 billion loans to 27 EU countries and the remainder goes to joint EU programs. It will be delivered over the next five years with a third being spent on reducing CO2 emissions in 27 EU economies.
3️⃣ Notable facts and economic data today
- tonight the US will announce March retail sales and request unemployment benefits.
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