SWEDEN: April CPI Mini Preview: Importance To Be Determined By Riksbank Minutes
Swedish April CPI is due at 0700BST/0800CET, with analysts expecting a small uptick after March’s surprisingly low print.
- In some ways, the importance of the inflation figure will best be gauged after the release of the Riksbank’s May meeting minutes at 0830BST.
- Following the guidance for 2 further rate cuts in H2 2024 (i.e. making a June rate cut unlikely), it will be interesting to see if any Executive Board members still consider a June cut to be on the table, or whether any members strongly considered holding rates in May.
- In any case, we will still get one more inflation print on June 14 before the June 27 meeting.
- Current Bloomberg consensus sees CPIF ex-energy at 3.0% Y/Y, while the Riksbank expected 3.3% Y/Y in the March MPR.
- An in-line reading would see the Riksbank’s March MPR forecast error reduce to -0.3pp (vs -0.4pp after the March print).
- Analysts generally expect rents to exert upward pressure on inflation in April, alongside food and energy.
- See below for a selection of analyst views from Scandinavian banks:
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EUROZONE ISSUANCE: EGB Supply: W/C 15 April, 2024 (1/2)
Slovakia, the Netherlands, Finland, Greece, Germany, Spain and France are all due to issue in the week ahead. We pencil in estimated gross issuance for the week at E41.9bln, above the E32.0bln seen last week. We see Austria and Italy as the most likely to hold syndications this week.
- Slovakia will kick off issuance for the week on Monday with a SlovGB auction. On offer will be the 3.00% Feb-26 SlovGB (ISIN: SK4000024675), the 3.00% Feb-28 SlovGB (ISIN: SK4000024683), the 3.75% Mar-34 SlovGB (ISIN: SK4000024865) and the 2.00% Oct-47 SlovGB (ISIN: SK4120013400).
- On Tuesday, the Netherlands will come to the market to hold a DDA to tap the on-the-run 30-year 2.00% Jan-54 DSL (ISIN: NL00150012X2) for E4-5bln (we expect the top of the target range to be sold). The initial spread guidance over the 2.50% Aug-54 Bund will be announced on Monday 15 April.
- Also on Tuesday, Finland will look to sell a combined E1.0-1.5bln of the 2.875% Apr-29 RFGB (ISIN: FI4000557525) and the 2.95% Apr-55 RFGB (ISIN: FI4000566294).
- Greece will look to hold a GGB auction on Wednesday. We look for a E250-300mln size with details to be announced on Tuesday.
- Wednesday will also see Germany hold a 30-year Bund auction. On offer will be E1bln of the 0% Aug-50 Bund (ISIN: DE0001102481) and E1bln of the 2.50% Aug-54 Bund (ISIN: DE000BU2D004).
EURGBP TECHS: Watching Support
- RES 4: 0.8678 38.2% retracement of the Feb 3 - Aug 23 bear cycle
- RES 3: 0.8620 High Jan 20
- RES 2: 0.8607 23.6% retracement of the Feb 3 - Aug 23 bear cycle
- RES 1: 0.8586/8602 High Apr 05 / High Mar 22 and key resistance
- PRICE: 0.8548 @ 06:40 BST Apr 15
- SUP 1: 0.8528/8504 Low Apr 12 / Low Mar 8
- SUP 2: 0.8498/93 Low Feb 14 / Low Aug 23 2023 and key support
- SUP 3: 0.8454 76.4% of the Mar 7 - Sep 26 ‘23 bull phase
- SUP 4: 0.8388 Low Aug 17 2023
EURGBP traded lower last week and the cross remains within this year’s broad range. A resumption of gains would refocus attention on key resistance at 0.8602, the Mar 22 high. Clearance of this hurdle would confirm a resumption of the recovery that started Feb 14 and open 0.8678, a Fibonacci retracement point. Support to watch is 0.8528, the Apr 12 low. A clear break would expose key support at 0.8498/93, the Feb 14 and Aug 23 2023 low.
EUROZONE T-BILL ISSUANCE: W/C April 15, 2024
Germany, the Netherlands, France, Spain, the ESM, Portugal, and the EU are due to sell bills this week. We expect issuance to be E21.4bln in first round operations, down from E28.6bln last week.
- This morning, Germany will come to the market to sell E2bln of the 6-month Oct 16, 2024 bubill and E3bln of the new 12-month Apr 16, 2025 bubill.
- Also this morning, the Netherlands will look to sell E1.0-1.5bln of the 2.5-month Jun 27, 2024 DTC and E1.0-1.5bln of the 5.5-month Sep 27,2024 DTC.
- This afternoon, France will look to issue up to E7.4bln of 13/20/26/49-week BTFs: E3.3-3.7bln of the new 13-week Jul 17, 2024 BTF, E0-0.4bln of the 20-week Sep 4, 2024 BTF, E1.3-1.7bln of the 26-week Oct 16, 2024 BTF and E1.2-1.6bln of the 49-week Mar 26, 2025 BTF.
- Tomorrow morning, Spain will look to sell the 3-month Jul 5, 2024 letras and the 9-month Jan 10, 2025 letras, with details to be announced on Monday.
- Also tomorrow, the ESM will come to the market to sell up to E1.1bln of the new 6-month Oct 17, 2024 bills.
- On Wednesday, Portugal will look to sell a combined E0.75-1.00bln of the 3-month Jul 19, 2024 BT and the 11-month Mar 21, 2025 BT.
- Also on Wednesday, the EU will look to issue up to E1.5bln of the 3-month Jul 5, 2024 EU-bill and up to E1.5bln of the 6-month Oct 4, 2024 EU-bill.
For more on future auctions see the full MNI Eurozone/UK T-bill auction calendar here.
