EUROPEAN INFLATION: German Services Moderate But Still Elevated in March [1/2]
German final March HICP was unrevised from the flash readings at 2.3% Y/Y (2.6% prior) and 0.4% M/M (0.5% prior). The final reading of national CPI was also unrevised at 2.2% Y/Y (2.3% prior) and 0.3% M/M (0.4% prior). Core CPI printed at 2.6% Y/Y (0.1pp upwardly revised, 2.7% prior), the lowest rate since June 2021.
- Overall, the CPI data confirms a notable deceleration in services Y/Y inflation (a -0.13pp smaller contribution than in February) but with a caveat that it was mostly driven by airfares with the Easter holidays in April this year vs March last year.
- Goods inflation slightly accelerated (+0.04pp contribution vs prior) as softer energy was not quite able to cancel out firmer food / core goods inflation.
- Echoing January and February's releases, the M/M pace of services has slowed compared to the same period in 2023 and 2024 but remains elevated on a historical comparison - see chart below. The still elevated pace is noteworthy though, especially when considering that the Mar 2024 M/M would have been boosted by the timing of Easter as noted above.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GILT TECHS: (M5) Short-Term Trend Set-Up Remains Bearish
- RES 4: 94.00 Round number resistance
- RES 3: 93.79 High Mar 4 and a bull trigger
- RES 2: 93.06 Low Mar 4 and a gap high on the daily chart
- RES 1: 92.63 High Mar 7
- PRICE: 91.90 @ Close Mar 11
- SUP 1: 91.67/90.71 Low Mar 7 / 6
- SUP 2: 90.49 1.618 proj of the Feb 6 - 20 - Mar 4 price swing
- SUP 3: 90.19 1.764 proj of the Feb 6 - 20 - Mar 4 price swing
- SUP 4: 89.71 2.000 proj of the Feb 6 - 20 - Mar 4 price swing
The S/T trend outlook in Gilt futures is unchanged, it remains bearish. Recent gains are considered corrective. Last week, the contract traded through a key support at 91.79, the Feb 20 low. This level also represented a bear trigger and the breach signals scope for a continuation lower, with sights on 90.49 next, a Fibonacci projection. The downtrend is oversold, the latest bounce has allowed this set-up to unwind. Initial resistance is 92.63, Mar 5 high.
MNI EXCLUSIVE: China steel outlook
Analysts share their China steel outlook. On MNI Policy MainWire now, for more details please contact sales@marketnews.com
USDJPY TECHS: Trend Needle Points South
- RES 4: 154.80 High Dec 12 ‘24 and a key resistance
- RES 3: 151.85 50-day EMA
- RES 2: 151.30 High Mar 3 and a key near-term resistance
- RES 1: 149.88 20-day EMA
- PRICE: 148.20 @ 06:55 GMT Mar 12
- SUP 1: 146.54 Low Mar 11
- SUP 2: 145.90 2.0% 10-dma envelope
- SUP 3: 145.00 Round number support
- SUP 4: 144.13 76.4% retracement of the 16 ‘24 - Jan 10 bull leg
A bear cycle in USDJPY remains in play and this week’s fresh cycle lows strengthen a bearish theme. The move down has resulted in a print below 146.95, 61.8% of the Sep 16 ‘24 - Jan 10 bull leg. Sights are on 145.92 next, the Oct 4 2024 low. Moving average studies remain in a bear-mode set-up, highlighting a dominant downtrend. Key short-term resistance is unchanged at 151.30, the Mar 3 high. Clearance of this level is required to signal a base.
