EUROPEAN INFLATION: Spain Softer Than Expected, Lower Leisure/Culture, Transport
Spain’s May preliminary HICP came in a tenth lower than expected on the yearly rate at 1.9% Y/Y (vs 2.0% cons; 2.2% prior) and the sequential reading at -0.1% M/M (vs 0.0% cons; 0.6% prior). The national CPI also came in 2 tenths below expectations on the yearly rate at 1.9% Y/Y (vs 2.1% cons; 2.2% prior) and a tenth below on the sequential comparison at 0.0% M/M (vs 0.1% cons; 0.6% prior).
- Core CPI (not HICP) came in below expectations, also, at 2.1% Y/Y (vs 2.2% cons; 2.4% prior).
- The headline rate was driven lower by leisure and culture prices, as well as transportation costs (to a lesser extent), INE adds. Electricity also contributed negatively to the Y/Y rate in May.
- Overall, there is little colour in the release, so for full detail we will have to await the final data. However, with both headline and core coming in below expectations overall this appears slightly soft - as was the France release earlier this week.
- For context, Spain represents 12% of the Eurozone HICP basket in 2025.
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GERMAN DATA: Retail Sales Keep Open Positive Consumer Spending GDP Contribution
German March retail sales came in at -0.2% M/M (real, seasonally-adjusted) and +2.2% Y/Y in March. That follows February's +0.2% M//M (downwardly revised but already known from +0.8%) and January's +0.7% M/M - meaning that while retail sales did not have an overly strong Q1, consumer spending should have the potential for a slightly positive contribution in the flash Q1 GDP data, to be published at 09:00 BST/10:00 CEST. Consensus for that stands at +0.2% Q/Q total.
- Looking at the individual categories, March's decrease appears driven by non-food sales at -0.6% M/M, while food sales were +0.3% M/M. Internet and mail orders stood out positively, at +0.6% M/M, Destatis adds - on a yearly comparison, growth in the sector is notable, at +9.5% Y/Y.
- Looking ahead, consumer sentiment has outperformed expectations recently; while improving despite the US tariff announcements, it remains overall weak.
MNI: SWISS KOF APR ECONOMIC BAROMETER 97.1
- MNI: SWISS KOF APR ECONOMIC BAROMETER 97.1
USDCAD TECHS: Trend Needle Points South
- RES 4: 1.4415 High Apr 1
- RES 3: 1.4296 High Apr 7
- RES 2: 1.4108 50-day EMA
- RES 1: 1.3906/3959 High Apr 17 / 20-day EMA
- PRICE: 1.3822 @ 07:59 BST Apr 30
- SUP 1: 1.3781 Low Apr 21 and the bear trigger
- SUP 2: 1.3744 76.4% retracement of Sep 25 ‘24 - Feb 3 bull run
- SUP 3: 1.3696 Low Oct 10 2024
- SUP 4: 1.3643 Low Oct 9 ‘24
The trend set-up in USDCAD is unchanged and remains bearish. A fresh cycle low on Apr 21 reinforces the bear cycle and signals scope for a continuation near-term. Potential is seen for a move towards 1.3744, a Fibonacci retracement. Moving average studies are in a bear mode position, highlighting a dominant downtrend. First resistance to watch is 1.3959, the 20-day EMA.
