GERMANY: Coalition To Focus First on Energy, Rent Freezes, Pension Level, Labour
SPD ministers in the German government are planning to initially focus on issues including energy price reductions, a rent freeze extension, ensuring a fix of the pension level at current rates, and "improving collective bargaining coverage" for employees, according to a BILD report overnight.
- On energy price reductions, CDU/CSU/SPD mention in their coalition agreement that they plan to "permanently reduce the burden on companies and consumers in Germany by at least five cents per kWh with a package of measures" incl. electricity tax, grid surcharge and levy reductions, as well as the introduction of an industry energy price for certain companies.
- German households paid an average of 12.28 ct/kWh in H2'24 for natural gas according to Destatis, and paid 39.80 ct/kWh for electricity according to the German Association of Energy and Water Industries - meaning that the disinflationary feedthrough to CPI should be at least notable.
- For industrial enterprises, the impact should also be noteworthy, but its feedthrough to prices / output will likely be less clear-cut comparatively.
- Current rent freeze regulations would expire end-2025, with details not straightforward. There is an ongoing debate on the measure domestically, with research pointing towards some restraint on rent inflation (at the expense of housing supply). An extension would tend to keep in place this rent inflation restraint on the margin.
- On the collectively negotiated labour market sector, the coalition agreement notes "our aim is to increase collective bargaining coverage. Collective wages must become the rule again andmust not remain the exception."
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GOLD TECHS: Monitoring Support At The 50-Day EMA
- RES 4: $3223.8 - 3.382 proj of the Nov 14 - Dec 12 - 19 price swing
- RES 3: $3200.00 - Round number resistance
- RES 2: $3196.2 - 3.236 proj of the Nov 14 - Dec 12 - 19 price swing
- RES 1: $3055.6/3167.8 - High Apr 7 / 3 and bull trigger
- PRICE: $3005.0 @ 06:59 BST Apr 8
- SUP 1: $2956.7 - Low Apr 7
- SUP 2: $2945.3 - 50-day EMA
- SUP 3: $2880.3 - Low Mar 10
- SUP 4: $2832.7 - Low Feb 28
The trend condition in Gold remains bullish and the latest pull back appears corrective. Moving average studies are in a bull-mode position highlighting a dominant uptrend and positive market sentiment. Price has traded through the 20-day EMA. The next key support to watch lies at 2945.3, the 50-day EMA. A resumption of gains would refocus attention on $3196.2, a Fibonacci projection. The bull trigger is 3167.8, the Apr 3 high.
JAPAN: Akazawa Notes Flexible Policy Response To Tariffs; Nikkei Up ~6%
Latest headlines from Japan's Economic Revitalisation Minister Akazawa (per BBG):
- "*JAPAN'S AKAZAWA: ANALYZING STATS TO ASSESS TARIFF IMPACT"
- "*AKAZAWA: TO CONTINUE FLEXIBLE POLICY RESPONSE TO DEVELOPMENTS"
The Nikkei has rallied ~6% during today's Asia-Pac session, linked to hopes of tariff negotiation between PM Ishiba and the Trump administration after a call yesterday. A reminder that US Tsy secretary Bessent noted after the call that he would "expect that Japan is going to get priority". Tariff-related headline flow, including progress around negotiations, will be a key focus in today's EU/US session too, with the data calendar reasonably light.
USDJPY TECHS: Gains Considered Corrective
- RES 4: 151.30 High Mar 3
- RES 3: 150.33/151.21 50-day EMA / High Mar 28 and reversal trigger
- RES 2: 149.00 20-day EMA
- RES 1: 148.18 Low Mar 20
- PRICE: 147.63 @ 06:53 BST Apr 8
- SUP 1: 144.56 Low Apr 4
- SUP 2: 144.13 76.4% retracement of the Sep 16 ‘24 - Jan 10 bull leg
- SUP 3: 143.43 Low Oct 2 ‘24
- SUP 4: 142.95 1.00 proj of the Feb 12 - Mar 11 - 28 price swing
USDJPY maintains a bearish tone following last week’s sharp sell-off and the latest recovery is - for now - considered corrective. A resumption of the downtrend and a break of Friday’s 144.56 low would signal scope for an extension towards 144.13, a Fibonacci retracement point. Initial firm resistance to watch is 149.00, the 20-day EMA. Resistance at the 50-day EMA, is at 150.33.
