Dear Reader,

Today's overview of economic news and market action

• Softer tone to risk appetite last week, with the S&P 500 falling by 3% …
• Heightened geopolitical tensions, remarks from central bankers and data releases impacted sentiment …
• Currency-wise, the dollar was in the ascendancy initially …
• However, as the week progressed, the dollar handed back its gains …
• Sterling was on the defensive at the end of the week …
• Sees EUR/GBP start today above 86p …
• EUR/USD is near the midpoint of $1.06-1.07 …
• This week, the focus will be on US GDP for Q1 and the March reading of core-PCE inflation …

PMI fell to 49.6 in Mar. The slight decline reflected a fall in new business and output and a sharp drop in sentiment. Meantime, inflationary pressures in the sector continued to build

ECB signals June rate cut on the cards

As widely anticipated, the ECB’s Governing Council meeting for April saw the central bank maintain its key deposit rate at 4%. It marked the fifth consecutive policy meeting that the ECB has kept rates unchanged. There was “consensus” rather than unanimity within the Governing Council on the decision.

Geopolitical Tension to the Fore Once Again

This week was very much characterised by “risk-off” sentiment in markets, as rising geopolitical tensions boosted safe haven assets.