US: MNI POLITICAL RISK - Trump Keeps Options Open On Iran Strikes

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• President Donald Trump heads to Capitol Hill this morning to convince competing House Republican factions to swallow their objections to the ‘One Big Beautiful Bill’. House Speaker Mike Johnson (R-LA) has teed up a vote in the House Rules Committee at 01:00 ET 06:00 BST tomorrow morning to advance the GOP reconciliation package to a full vote.
• Secretary of State Marco Rubio will deliver testimony at two Congressional hearings on Trump’s FY26 budget request. Rubio will be grilled on budget cuts and foreign policy issues, including the Ukraine war, Gaza, and Iran nuclear talks. Ranking Democrat Senator Jeanne Shaheen (D-NH) intends to tell Rubio that, “this Administration has eviscerated six decades of American foreign policy investments, undercutting our ability to compete with adversaries like China.”
• Treasury Secretary Scott Bessent is in Banff, Canada, for the first meeting of G7 Finance Ministers and Central Bank Governors since Trump’s Liberation Day tariffs.
• White House National Economic Council Director Kevin Hassett said US debt is still the safest on Earth, despite the Moody’s downgrade.
• The Senate voted 66-32 to clear a key procedural hurdle for the landmark bill to regulate stablecoins.
• Trump appeared to distance the US from future Ukraine-Russia talks after a two-hour call with Russian President Vladimir Putin.
• Iranian leaders reiterated that they will not cease their enrichment programme in a new nuclear deal with the US.
• Poll of the Day: American views on deregulation are largely unchanged.

Full Article: US DAILY BRIEF

• Utilities, healthcare are still the leading sectors within the Stoxx600, but in 3rd Place are the Banks.
• The SX7E could now be open to test the next upside are of 217.62, the big 38.2% retracement of the whole 2007/2020 range.
• BNP is most weighted in this SX7E Index.

(Chart source: MNI/Bloomberg).

MNI median consensus for Canada April CPI (0830ET) is for Y/Y headline of 1.6% (though there are some forecasts 0.1pp on either side), from 2.3% in March. The average of Trim and Median CPI measures is seen at 2.95% Y/Y, up from 2.85% in March, albeit only from a limited set of analysts. 

• The headline deceleration will mainly reflect lower energy prices after the April 1 elimination of the consumer carbon tax and high year-before gasoline base effects. In contrast, core measures - which exclude indirect tax changes - are unlikely to show much of a disinflationary pullback if at all: CPI Median is seen steady at 2.9% Y/Y per the Bloomberg survey, with CPI Trim likewise unchanged at 2.8%, though individual analysts' forecasts suggest slight upside risks to that consensus.
• This should keep core measures tracking close to the Bank of Canada's scenario assumptions for Q2 (there was no central forecast but the two scenarios reflecting different US-Canada tariff war outcomes showed 2.9% or 3.0% for Y/Y CPI-trim and CPI-median in Q2), and as such shouldn't preclude a rate cut at the next meeting in June.
• The reacceleration of inflationary pressures at the start of the year were largely due to the end of a sales tax holiday (federal tax break ended Feb 15, with March was the first full month with GST/HST re-applied to affected products since November 2024 ie restaurant dining, alcohol, toys), but that should continue to ease off in Q2.
• Factors to be watched as upside drivers include food and core goods inflation, with any sign of passthrough of a weaker Canadian dollar Y/Y and retaliatory tariffs on the US eyed closely for impacts on import prices. On the downside, shelter prices are seen softening again.