GOLD: Gold Gives Back Overnight Gains 

TYM5 traded in a narrow 110-30+ to 111-04 range during the Asia-Pacific session, heading into the London open. It last changed hands at 111-01, down 0.01 from the previous close.

• The US 10-year yield has consolidated in a tight range of 4.3117 - 4.3369% in Asia, dealing around 4.33% as we head into the London open.
• US yields continued to benefit from comments made overnight by Deputy Treasury Secretary Michael Faulkner who said officials are discussing a move to loosen bank regulations and allow lenders to keep more Treasuries on their balance sheets.
• The market is keenly awaiting Fed Chair Jerome Powell’s speech later today discussing the economic outlook.
• Dips back towards 4.25/30% should now find supply, as the market consolidates heading into a long weekend.
• Today's Data: Retail Sales, Industrial Production, Capacity Utilization, NAHB Housing Market Index.

At the Tokyo lunch break, JGB futures are stronger, +44 compared to settlement levels, hovering just below session highs. 

• Cash US tsys are 1bp cheaper to 3bps richer, with a steepening bias, in today's Asia-Pac session after yesterday's modest gains.
• BoJ Governor Ueda has commented to local newspaper Sankei, noting the central bank will have to monitor the tariff impact and may need to respond if the economy is impacted. (per RTRS)
• The next BoJ policy meeting is at the start of May. Market expectations for rate hikes have been sharply scaled back over the past month in response to President Trump's announcement of reciprocal tariffs. Markets now assign a 0% probability to a 25bp hike at the May meeting, with less than a cumulative 50% chance not priced in by December.
• This marks a significant shift from just a month ago when a full hike was priced by October and a 50% probability was expected by June.
• Cash JGBs are 2-7bps richer across benchmarks, with a flattening bias. The benchmark 10-year yield is 3.9bps lower at 1.332% versus the cycle high of 1.596%.
• Swaps have also bull-flattened, with rates 2-8bps lower. Swap spreads are mixed.

AUDUSD bounced on the generally stronger-than-expected March China activity data but it has reversed those gains to be down 0.1% as China/HK equities sell off. The pair is now at 0.6338 after a low of 0.6323 early in trading following the decline in the S&P. The USD index is 0.2% lower.

• Safe haven currencies are outperforming today leaving AUDJPY down 0.5% to 90.42, after an intraday low of 90.38. AUDEUR is also 0.5% lower at 0.5595, close to today’s low. AUDGBP is down 0.25% to 0.4783.
• Kiwi is also risk sensitive but continues to marginally outperform Aussie. AUDNZD is down 0.2% to 1.0739 after a trough of 1.0738.
• The Westpac leading index for March fell 0.11% m/m leaving the 6-month annualised rate at 0.6% down from 0.9% in February. There are signs that it is being impacted by the effect on markets of recent global developments.
• Equities are generally weaker with the Hang Seng down 2.0%, CSI 300 -0.9% and S&P e-mini down 0.8%, but ASX up 0.3%. Oil prices are lower with WTI -0.3% to $61.12/bbl. Copper is down 0.7% and iron ore tested $97/t.
• Later Fed Chairman Powell speaks to Chicago’s Economic Club, also Hammack and Schmid appear. US March retail sales, IP and April NY Fed services & NAHB housing indices print. UK March CPI, euro area final March CPI and February current account are released. The BoC decision is announced and with expectations for unchanged rates.