US DATA: Confidence Appears To Have Improved Since Tariff "Pause"; Still Poor

Apr-25 14:52

Consumer sentiment readings in the University of Michigan survey improved in the final version compared with the prelim, reflecting the pullback in inflation expectations post-April 9 tariff "pause" as noted elsewhere.

  • Current economic conditions (59.8 vs 56.5 prelim, 63.8 prior), expectations (47.3 vs 47.2 prelim, 52.6 prior), and overall consumer sentiment (52.2 vs 50.8 prelim, 57.0 prior) were all still at multi-month lows but improved from the preliminary reading. Expectations in the prelim had been the weakest since 1980, but is not "just" joint-lowest since then (July 2022 was also 47.3).
  • The most notable movers in survey responses vs prelim were "good time to buy a major household item (82 vs 75 prelim, 89 prior), so now just the lowest since November 2024 vs what in prelim looked like the weakest since November 2022; with "business expectations over the last few months" plummeting to 1 (vs 13 prelim, 23 prior), the latter joint-lowest since summer 2020.
  • The % seeing job losses for either themselves and/or their spouse over the next 5 years ticked lower to 21.1% (22.5% prelim, 23.1% prior) but this was still very elevated.
  • However despite the apparent tariff reprieve, there was only a 1 point improvement to 52 in "government doing a good job fighting inflation and unemployment" - still the lowest since 2011 and around historic lows.
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Historical bullets

EURGBP TECHS: Finds Support

Mar-26 14:42
  • RES 4: 0.8494 High Aug 26 ‘24        
  • RES 3: 0.8474 High Jan 20 and a key resistance
  • RES 2: 0.8428/8450 High Mar 18 / 11 and the bull trigger
  • RES 1: 0.8395 High Mar 24      
  • PRICE: 0.8369 @ 14:41 GMT Mar 26 
  • SUP 1: 0.8333 Intraday low 
  • SUP 2: 0.8321 61.8% retracement of the Mar 3 - 11 bull leg 
  • SUP 3: 0.8391 76.4% retracement of the Mar 3 - 11 bull leg 
  • SUP 4: 0.8241 Low Mar 3 and a key support 

EURGBP has traded lower this week. However, today’s rally from the intraday low highlights a possible reversal. A strong daily close today would strengthen the bullish significance of today’s bounce. Note that MA studies are in a bull-mode position. This suggests that the pullback from the Mar 11 high, has been a correction. Resistance to watch is 0.8395, the Mar 24 high. Key near-term support lies at 0.8333, today’s intraday low.

SNB: Quarterly Bulletin / Business Cycle Signals Provide Backdrop of SNB Cut

Mar-26 14:38

The SNB has published their "quarterly bulletin" as well as their quarterly "business cycle signals". Key highlights:

  • "For the next two quarters, companies expect purchase and sales prices to remain stable or rise slightly (chart 8). On the one hand, reductions in the price of electricity and gas are curbing costs. On the other hand, the rising prices of certain raw materials and inputs are leading to slight upward pressure on purchase prices in manufacturing and construction" - suggests risks of material deflation in Switzerland are limited for the moment "
  • The companies surveyed report solid turnover growth overall in the first quarter. Growth momentum in the services sector and construction remains robust. Turnover in manufacturing also saw tangible growth, having barely increased in previous quarters" - the KOF indicator points towards robust growth ahead
  • "Companies are no longer as concerned as in previous years about the shortage of specialist staff and recruitment difficulties. Staffing levels are approximately in line with companies’ needs" - mirroring the softening labour market in Switzerland
  • "The growth outlook is brightening somewhat but is still subject to considerable uncertainty. In particular, as long as the precise details of the new US administration’s trade policy are not known, the effects are difficult for companies to assess" - as expected given the current global backdrop

Link to the quarterly bulletin (also contains business cycle signals
publication on the back): https://www.snb.ch/en/publications/quarterly-bulletin/2025/quartbul_2025_1_komplett

 

GILTS: /SWAPS: TD Securities Maintain Recommendations Post-Spring Statement

Mar-26 14:34

In the wake of the Spring Statement TD Securities “continue to see value in 10s30s flatteners and paid 5s10s30s fly. Also, we hold long bias for long-end ASW.”