US OUTLOOK/OPINION: Core PCE Tracking For April Centers Around 0.13% M/M
Analyst estimates for core PCE inflation in April have come in lower than we initially expected after Thursday’s PPI report. They appear to be averaging 0.13% M/M as opposed to the 0.15-0.20 range we initially thought they might fall into vs post-CPI estimates averaging 0.20% with a range of -0.02-0.25%.
There is though general expectation of upward revisions to March in particular which limits some of the dovish surprise within the latest April PPI release. That is an upward revision to what was originally a very soft 0.03% M/M in March as it moderated after a booming 0.50% M/M in February.
Post CPI and PPI Estimates
- GS 0.11% (0.19% post-CPI)
- JPM 0.11% (0.19% post-CPI)
- Barclays 0.12% (0.22% post-CPI) with “modest” upward revisions to March
- BofA 0.14% (0.20% post-CPI) but expect March to be revised up from 0.0% to 0.1%
- Morgan Stanley 0.16% (0.20% post-CPI) with upward revisions of +7bp in Mar and +3bp in Jan
Post CPI Estimates
- TD Securities: -0.02%
- Nomura 0.11%
- BNP Paribas 0.15%
- Deutsche Bank 0.23%
- UBS 0.25%
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US: Dimon Says Trump Administration Should Re-Engage With China - FT Interview
Speaking in a wide-ranging interview with The Financial Times, JPMorgan Chase CEO Jamie Dimon has urged the Trump administration to re-engage with China. Dimon’s comments may carry additional weight as President Donald Trump acknowledged that Dimon's remarks influenced his decision to rein in his tariff agenda last week.
- Dimon: “I don't think we have any engagement right now, and so - but that can start tomorrow. So, it doesn't have to wait a year. It could start tomorrow. You start with a phone call.”
- Dimon also urged the Trump administration to bolster its alliances to better address China: “I would want to negotiate eventually with Europe, with the UK, with Japan, Korea, Australia, Philippines, and … then face off with China and say, we want to trade with you, but here are the terms of trade that we all think are fair and reasonable.”
- On Treasury markets: “…there clearly was hedge fund deleveraging, which caused some of this. I think the real issue is, there's ongoing uncertainty around tariffs…”
- On Treasury Secretary Scott Bessent: “I think he's an adult… I think he's the guy who should probably be negotiating these trade agreements.”
- Bloomberg notes that ahead of his tariff reversal, Dimon piqued Trump's interest, "particularly when he said it was “perfectly reasonable” to conclude that global trade was unfair. Dimon encouraged foreign policymakers to take a calm approach and “negotiate some trade deals.”"
US 10YR FUTURE TECHS: (M5) Pressuring 20-day EMA
- RES 4: 114-10 High Apr 7 and the bull trigger
- RES 3: 113-00 Round number support
- RES 2: 112-08 High Apr 8
- RES 1: 111-00+/111-20 20-day EMA / High Apr 9
- PRICE: 110-31 @ 17:10 BST Apr 15
- SUP 1: 109-08 Low Apr 11
- SUP 2: 108-26+ 76.4% retracement of the Jan 13 - Apr 7 bull cycle
- SUP 3: 108-21 Low Feb 19
- SUP 4: 108-03+ Low Dec 12 ‘24 and a key support
The recovery for Treasury futures extended into a second session Tuesday, with prices pressuring the 20-day EMA on the upside. This levels market initial resistance and a close above could signal that start of a stronger correction higher. For now, the technical trend remains lower: price traded through an important support last week: a trendline at 110-03+, drawn from the Jan 13 low. A clear break of this trendline would strengthen a bearish threat and signal scope for a deeper retracement. This would open 108-26+, a Fibonacci retracement.
FED: US TSY AMENDS 5Y ANNOUNCEMENT
- US TSY AMENDS 5Y ANNOUNCEMENT
- US TSY TO SELL $25.000 BLN 5Y TIPS APR 17, SETTLE APR 30
