MNI US OPEN: Yen Weakness Persists

MNI: BADEN-WUE APR CPI +1.2% M/M, +7.0% Y/Y; MAR +6.3% Y/Y

MNI: BAVARIA APR CPI +0.4% M/M, +7.5% Y/Y;  MAR +7.8% Y/Y

MNI: SAXONY APR CPI +1.0% M/M, +7.2% Y/Y; MAR +7.0% Y/Y

MNI: SPAIN FLASH APR HICP -0.2% M/M , +8.3% Y/Y; MAR +9.8%

Headline Inflation Slows, Core Picks Up

FLASH APR HICP -0.2% M/M , +8.3% Y/Y; MAR +9.8%

FLASH APR CPI -0.1% M/M, +8.4% Y/Y; MAR +9.8%

FLASH APR CORE CPI +4.4% Y/Y; MAR +3.4%

• Spanish harmonised CPI fell back 1.5pp in the flash April meeting, substantially more than the decline to +9.0% y/y anticipated by consensus however within the range MNI expected.
• HICP fell on the month, contracting by a modest -0.2% m/m.
• A decrease in energy and fuel costs due to state intervention is the key downwards driver in this data, food prices continued to accelerate.
• Core CPI continued to climb, accelerating by one point to +4.4% y/y and reaching the highest level since 1995.

Source: INE

MNI: ITALY APR CONSUMER CONFIDENCE INDEX 100.0 VS MAR 100.8

MNI: ITALY APR SA MANUFACTURING MORALE 110.0 VS MAR 110.1

FIXED INCOME: Core FI a little lower this morning

• After some strength early in the European morning session, particularly for Bunds, on the back of a softer-than-expected Spanish inflation print, we have seen core fixed income reverse its gains and is now marginally lower than yesterday's closing levels.
• The other notable data this morning has seen some regional German CPI prints. 3/5 have been roughly in line and two higher than the consensus for the national print which is due out at 13:00BST / 8:00ET.
• Outside of European inflation prints, focus will be on the first print of US GDP for Q1. Consensus looks for a 1.0% print with most estimates in the range of 0.0-1.5%.
• TY1 futures are down -0-0+ today at 119-25 with 10y UST yields down -1.1bp at 2.823% and 2y yields down -0.8bp at 2.585%.
• Bund futures are down -0.16 today at 155.30 with 10y Bund yields up 1.8bp at 0.817% and Schatz yields up 2.4bp at 0.117%.
• Gilt futures are down -0.15 today at 119.27 with 10y yields up 2.0bp at 1.830% and 2y yields up 2.5bp at 1.507%.

FOREX: USD/JPY Through Y130 as BoJ Give The All Clear

• The Bank of Japan overnight gave the greenlight for further JPY weakness, as the board reinforced their message that yield curve control will be in place until the economy enters a sustainable recovery. This keeps the BoJ committed to easing policy going forward - running a starker contrast with Fed ahead of next week's FOMC decision.
• The market response was to run USD/JPY through Y130.00 and to new cycle highs of Y130.96. The next upside level to watch in the pair crosses at the 131.96 mark - the 1.00 projection of the Feb 24 - Mar 28 - 31 price swing. Needless to say, JPY is comfortably the poorest performer in G10.
• At the other end of the table, SEK is rallying as the Riksbank went against consensus and lifted interest rates to 0.25%. Furthermore, the repo rate projections outline a bank that now looks certain to hike further in June, with strong possibilities of further hikes in September, November as well as February next year. EUR/SEK extended its two-day decline, taking out the 200-dma support at 10.2793 in the process.
• The Fed and Bank of England remain in their pre-rate decision blackout periods, meaning Thursday will likely be a quiet session for central bank speak - keeping focus on the recent market volatility and - in particular - the run higher in the dollar.
• National German CPI data follows later today, as well as weekly jobless claims from the US and the advanced reading of Q1 GDP.

EQUITIES: Tech Leading US Gains

• Asian markets closed higher: Japan's NIKKEI closed up 461.27 pts or +1.75% at 26847.9 and the TOPIX ended 38.86 pts higher or +2.09% at 1899.62. China's SHANGHAI closed up 17.203 pts or +0.58% at 2975.485 and the HANG SENG ended 329.81 pts higher or +1.65% at 20276.17.
• European equities are rebounding, with the German Dax up 270.31 pts or +1.96% at 14063.81, FTSE 100 up 60.56 pts or +0.82% at 7486.77, CAC 40 up 121.67 pts or +1.89% at 6568.25 and Euro Stoxx 50 up 70.77 pts or +1.9% at 3805.39.
• U.S. futures are higher, led by tech (amid a busy tech earnings schedule), with the Dow Jones mini up 368 pts or +1.11% at 33594, S&P 500 mini up 72 pts or +1.72% at 4252.25, NASDAQ mini up 302 pts or +2.32% at 13310.75.

COMMODITIES: Oil Inches Higher

• WTI Crude up $0.81 or +0.79% at $102.81
• Natural Gas up $0.01 or +0.08% at $7.342
• Gold spot up $1.51 or +0.08% at $1887.52
• Copper up $0.25 or +0.06% at $447.5
• Silver down $0.04 or -0.18% at $23.257
• Platinum up $10.35 or +1.12% at $930.59