MNI US OPEN - Trade War Expands as China Block Boeing

EXECUTIVE SUMMARY:

• TRADE WAR EXPANDS AS CHINA HALT ALL BOEING ORDERS
• BOSTIC: FED IN PAUSE MODE
• VANCE TALKS UP POSSIBILITY OF UK-US TRADE DEAL
• UK WAGES DATA COULD EASE PASSAGE OF BOE RATE CUTS

Figure 1: UK pay momentum is slowing as AWE align with PAYE data

NEWS

US/CHINA (BBG): China Orders Halts to Boeing Jet Deliveries as Trade War Expands
China has ordered its airlines not to take any further deliveries of Boeing Co. jets as part of the tit-for-tat trade war that’s seen US President Donald Trump levy tariffs of as high as 145% on Chinese goods, according to people familiar with the matter. 

FED (MNI): Fed In Pause Mode Amid High Uncertainty - Bostic
Atlanta Fed President Raphael Bostic said Monday the Fed is in a "pause position" while it waits for more clarity on where the economy is headed, noting businesses are saying things to the same effect. "The fog has gotten really, really thick. It's hard to see far into the future. For me, I want to pull over," he told an Emory University banquet. He said still expects growth to slow to above-1% from 2.2%-2.3% at the start of the year. 

US/RUSSIA (BBG): Trump Envoy Witkoff Says Had ‘Compelling’ Meeting With Putin
President Donald Trump’s special envoy described his talks with Russian leader Vladimir Putin last week as “compelling,” saying they discussed steps that could end the war in Ukraine and perhaps lead to business opportunities.

ECB (MNI): Q1 BLS Consistent With Waning Restrictiveness; But Firm Loan Demand Weak
The results of the ECB's Q1 BLS survey are consistent with the Governing Council's description of "meaningfully less restrictive" policy rates, with credit standards easing (or seeing smaller net tightening) than in Q4. While consumer credit demand is increasing, the fall in firm loan demand suggests the economy would still benefit from lower interest rates, particularly given the current level of policy uncertainty.

UK/US (MNI): VP Vance Talks Up Possible Trade Deal
In an interview with UnHerd, US Vice President JD Vance talks up the prospect of a trade deal being struck with the UK. Vance says, "We're certainly working very hard with Keir Starmer's government" [on a trade deal], adding, "I think there's a good chance that, yes, we'll come to a great agreement that's in the best interest of both countries". 

AUSTRALIA (MNI): RBA Doubtful Over Tariff Impact On GDP - Minutes
The Reserve Bank of Australia monetary policy board doubted increasing global tariffs would have a significant impact on domestic economic growth, despite acknowledging this could change, according to the published minutes from the April 1 decision. “It is important for monetary policy to be forward-looking,” the board stated. “However, the information to hand did not imply a significant change in the outlook, despite the substantial level of uncertainty.” 

BOJ (BBG): BOJ Is Likely to Put Rate Hike Aside for Now, Ex-Official Says
The Bank of Japan will probably leave aside raising interest rates for now due to uncertainties stemming from US tariff measures that could deal a blow to Japan’s economy, according to a former executive director.

OIL (BBG): Global Oil Surplus to Persist in 2026 as Demand Sags, IEA Says
The International Energy Agency slashed forecasts for global oil demand this year amid the brewing trade war, and in its first detailed assessment of 2026 predicted a persistent supply surplus. The adviser to major economies chopped projections for 2025 demand growth by a hefty 300,000 barrels a day — or almost a third — to 730,000 barrels a day, according to a monthly report on Tuesday. Half of the reduction was concentrated in the US and China, which are engaged in a full-blown trade war. 

SINGAPORE (BBG): Singapore to Hold General Elections on May 3
Singapore's government has dissolved parliament, paving the way for elections in which Prime Minister Lawrence Wong will seek a mandate to tackle cost-of-living concerns and lead the nation through a complicated new era. The election will focus on economic realities, including high living costs and the impact of global trade uncertainties on Singapore's growth, with the government announcing plans to spend almost S$124 billion on various initiatives this year.

**MNI: FRANCE MAR HICP +0.2% M/M, +0.9% Y/Y
FRANCE MAR CPI +0.2% M/M, +0.8% Y/Y

MNI: UK MAR CLAIMANT CHG +18700
UK MAR CLAIMANT RATE +4.7%
UK FEB AVE WEEKLY EARNINGS +5.6% YY
UK FEB AVE WEEKLY EARNINGS EX-BONUS +5.9% YY

EGBS: Shallow Pullback In Bund Futures On Equity Rally and Supply

Pullbacks in Bund futures have been shallow, with tariff-related uncertainty and expectations for an ECB cut on Thursday somewhat offsetting pressure applied by this morning's European equity rally and sovereign supply calendar. 

• Futures are +22 ticks at 131.26, down from session highs of 131.57. The bull trigger is defined at 132.03 (Apr 7 high), with the 20-day EMA at 129.73 continuing to provide support.
• German cash yields are within 1bp of yesterday’s closing levels, the curve lightly twist flattens.
• Germany will look to sell E4.5bln of the 2.40% Apr-30 Bobl at 1030BST. Finland also comes to the market this morning.
• The ECB’s Q1 BLS shouldn’t change expectations for a 25bp cut on Thursday, but may contribute to wording tweaks in the policy statement, with the results consistent with “meaningfully less restrictive” policy.
• EGB spreads to Bunds little changed to 3.0bp wider on the day. OATs outperform Bunds at the margin (0.5bp tighter), with little of note when it comes to French news flow. We don’t see a meaningful headline driver for the widening in GGBs (~3.0bp vs. Bunds to 88bps).
• This morning’s other data weren’t material market movers: The German April ZEW survey saw a much weaker than forecast expectations component (-14.0 vs 10.0 cons, 51.6 prior), owing to tariff uncertainty and a DAX pullback. February Eurozone IP was stronger-than-expected at 1.1% M/M (vs 0.3% cons, 0.6% prior). 

GILTS: Off Highs Around Auction, Most Of Cross-Market Outperformance Intact

The presence of this morning’s 10-Year supply seemed to limit the rally in gilts.

• Bulls were unable to breach 92.00 in futures, with the contract topping out at 91.99 ahead of the bidding deadline.
• Decent demand metrics at the auction then pushed the space back towards, but not to, session bests.
• Futures have peaked at 91.99 for now, with the contract seeing a more meaningful break above the 20-day EMA (91.81). Next resistance located at the April 8 high (92.63), although there may be some focus on April 10 low in 10-Year yields (4.616%).
• Yields 1-4bp lower across the curve, bull steepening.
• Outperformance vs. core DM peers intact (outside of U.S. 30s), with some focus on the softer elements of this morning’s labour market data (wage and payroll components).
• Dovish reaction in GBP STIRs to the data/long end rally.
• BoE-dated OIS prices just over 75bp of cuts through year-end, with 23bp of cuts discounted for next month.
• SONIA futures flat to +6.0. Last week’s highs intact across the strip.
• UK CPI data due tomorrow, with the median of the sell-side surveys that we read showing downside risks to both the BBG median and BoE expectations (our full preview is here).
• Expect macro cues to dominate between now and then.

FOREX: NZDUSD Extends Five-Day Bounce to 8%

• The more stable tone for risk this week continues to foster a more constructive backdrop for higher beta currencies in the G10 space. AUD and NZD have both risen the best part of half a percent on Tuesday. For NZDUSD specifically, the pair has rallied as high as 0.5928, perfectly matching initial resistance, at the late November highs. In just 5 sessions, NZDUSD has bounced 8% from its cycle lows.
• For AUDUSD, we are reapproaching the 0.6400 mark, and a break above 0.6409 would place the cross at the highest level since December, signalling scope for a stronger recovery towards 0.6550, the Nov 25 high.
• Following this morning’s mixed UK jobs data, GBPUSD stands 0.32% higher on the session and is notably above the bull trigger of 1.3207, fresh six-month highs for the cable. This confirms the end of the recent Apr 4 - 7 correction, and highlights a resumption of the medium-term uptrend. Sights are on 1.3274 next, the Oct 3 ‘24 high.
• Standing out amid the lower US yields this week is the Swiss Franc, which remains in close proximity to its recent cycle highs. For USDCHF, last week’s 0.8099 low matched perfectly with touted support, the 76.4% retracement of the Jan 15 '15 - Dec 15 '16 recovery. This remains the key short-term support. Additionally, EURCHF is trading within 30 pips of the major double bottom support around 0.9210. A break of which will be sure to have the attention of the SNB.
• There has been less emphasis on the major pairs Tuesday, as EURUSD and USDJPY trade close to unchanged levels at 1.1350 and 142.95 respectively. Canada CPI highlights the economic calendar, alongside releases of US Empire State Manufacturing and import prices for March.

EQUITIES: Bounce in Stocks Allows Oversold Condition to Unwind

A short-term reversal higher in S&P E-Minis last week highlights the start of a corrective cycle. The trend condition has been oversold following recent weakness and the move higher is allowing this set-up to unwind. Eurostoxx 50 futures continue to trade above their recent lows. The latest bounce highlights the start of a corrective cycle and if this is correct, marks an unwinding of the recent oversold trend condition.

• Japan's NIKKEI closed higher by 285.18 pts or +0.84% at 34267.54 and the TOPIX ended 24.84 pts higher or +1% at 2513.35.
• Elsewhere, in China the SHANGHAI closed higher by 4.854 pts or +0.15% at 3267.662 and the HANG SENG ended 48.87 pts higher or +0.23% at 21466.27.
• Across Europe, Germany's DAX trades higher by 309.15 pts or +1.48% at 21264.04, FTSE 100 higher by 79.62 pts or +0.98% at 8213.99, CAC 40 up 35.65 pts or +0.49% at 7308.77 and Euro Stoxx 50 up 48.42 pts or +0.99% at 4959.81.
• Dow Jones mini up 27 pts or +0.07% at 40769, S&P 500 mini up 4 pts or +0.07% at 5444.5, NASDAQ mini up 42.75 pts or +0.23% at 18977.25.

COMMODITIES: Bearish WTI Theme Intact

The trend condition in Gold remains bullish and price is trading at its recent highs. The yellow metal last week traded through $3167.8, the Apr 3 high, to resume the primary uptrend and trade to fresh all-time highs. A bearish theme in WTI futures remains intact and the rally last Wednesday is - for now - considered corrective. The move higher is allowing an oversold trend condition to unwind. Recent weakness has resulted in the breach of a number of important support levels.

• WTI Crude down $0.04 or -0.07% at $61.46
• Natural Gas up $0.01 or +0.33% at $3.331
• Gold spot up $18.16 or +0.57% at $3228.3
• Copper down $0.85 or -0.18% at $467.5
• Silver up $0.01 or +0.02% at $32.3408
• Platinum up $6.5 or +0.68% at $959.09
   

Date	GMT/Local	Impact	Country	Event
15/04/2025	0900/1100	**	EU	Industrial Production
15/04/2025	0900/1100	***	DE	ZEW Current Expectations Index
15/04/2025	0900/1000	**	GB	Gilt Outright Auction Result
15/04/2025	1215/0815	**	CA	CMHC Housing Starts
15/04/2025	1230/0830	***	CA	CPI
15/04/2025	1230/0830	**	CA	Monthly Survey of Manufacturing
15/04/2025	1230/0830	**	US	Import/Export Price Index
15/04/2025	1230/0830	**	US	Empire State Manufacturing Survey
15/04/2025	1255/0855	**	US	Redbook Retail Sales Index
15/04/2025	1300/0900	*	CA	CREA Existing Home Sales
15/04/2025	1530/1130	**	US	US Treasury Auction Result for 52 Week Bill
15/04/2025	2310/1910		US	Fed Governor Lisa Cook
16/04/2025	2350/0850	*	JP	Machinery orders
16/04/2025	0200/1000	***	CN	Fixed-Asset Investment
16/04/2025	0200/1000	***	CN	Retail Sales
16/04/2025	0200/1000	***	CN	Industrial Output
16/04/2025	0200/1000	***	CN	GDP
16/04/2025	0200/1000	**	CN	Surveyed Unemployment Rate M/M
16/04/2025	0600/0700	***	GB	Consumer inflation report
16/04/2025	0800/1000	**	EU	EZ Current Account
16/04/2025	0800/1000	**	IT	Italy Final HICP
16/04/2025	0900/1100	***	EU	HICP (f)
16/04/2025	1000/1100	**	GB	Gilt Outright Auction Result
16/04/2025	1100/0700	**	US	MBA Weekly Applications Index
16/04/2025	1230/0830	***	US	Retail Sales
16/04/2025	1315/0915	***	US	Industrial Production
16/04/2025	1345/0945	***	CA	Bank of Canada Policy Decision
16/04/2025	1400/1000	*	US	Business Inventories
16/04/2025	1400/1000	**	US	NAHB Home Builder Index
16/04/2025	1430/1030	**	US	DOE Weekly Crude Oil Stocks
16/04/2025	1430/1030		CA	BOC press conference
16/04/2025	1600/1200		US	Cleveland Fed's Beth Hammack
16/04/2025	1700/1300	**	US	US Treasury Auction Result for 20 Year Bond
16/04/2025	1730/1330		US	Fed Chair Jerome Powell
16/04/2025	2000/1600	**	US	TICS
17/04/2025	2245/1045	***	NZ	CPI inflation quarterly