Morning Brew March 9 2023
Erik Schafhauser
Senior Relationship Manager
Summary: Consolidation time - until tomorrow?
Good Morning,
Jerome Powell maintained his stance yesterday at the second day of his hearing and markets remained fairly calm with the three US Indexes rise but all less than 0.5%. The CME sees the probability of a 50 BPS hike in March at 68% , 2 year yields are 5.05% now and the USD Index remains high at 105.60, EURUSD is 1.0550, GBPUSD 1.1855 and USD JPY 136.70. Gold and Silver are 1815 and 20.05.
The Ger40 is rather strong, since Tuesday the US 500 remains 1.5% loser while the German Index only trades 0.06% lower. The Swiss SMI looks vulnerable on a technical level but it closed just above key support at 10.994.
Chinese Data showed lower inflation over night with the PPI falling more than expected and the CPI rose 0.9% less then expected and the Bank of Canada left rates unchanged as it sees inflationary pressures easing. The Loonie traded at the lowest level since October 2022.
Tomorrows Nonfarm Payroll is coming into strong focus as it is the first real data point to signal 50 or 25 basis points on March 22nd. The expectation is at 205k added jobs after the 517k reported last month – which caused the sharp move towards higher rates in the US The highest estimate acc to Refinitiv is 325 and the lowest 79.
Remain cautious and expect sharp moves tomorrow at the nonfarm payroll.
Thursday
Data: Japan GDP, China PPI, CPI, US Initial Jobless claims
Earnings Wheaton Precious Metals Ulta Beauty Hannover Rueck Deutsche Post PRADA Contemporary Amperex
Friday
Data: DE HICP, UK GDP,US Nonfarm Payrolls,
Earnings: Daimler Truck Holding DiDi Global Inc ZTE BNP Oracle JD.com
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