EU HEALTHCARE: US Pharma: Possible Ban on Advertising

• RES 4: $3578.0 - 2.000 proj of the Dec 19 - Feb 24 - Feb 28 swing 
• RES 3: $3547.9 - 1.764 proj of the Feb 28 - Apr 3 - Apr 7 price swing
• RES 2: $3435.6/3500.1 - High May 7 / High Apr 22 and bull trigger
• RES 1: $3347.5 - High May 9        
• PRICE: $3231.5 @ 07:31 BST May 14
• SUP 1: $3202.0 - Low May 1 and a key support 
• SUP 2: $3164.5/64.3 - 50-day EMA / 61.8% of Apr 7 - Apr 22 upleg 
• SUP 3: $3100.0 - Round number support 
• SUP 4: $3071.5 - Low Apr 10

The latest pullback in Gold still appears corrective. Key short-term support to watch is $3202.0, the May 1 low. A clear break of this level would undermine the short-term bullish theme and signal scope for a deeper retracement. This would open $3164.3, 61.8% of the Apr 7 - Apr 22 upleg. Note that the 50-day EMA is at $3164.5 - a key support too. The M/T trend remains bullish, a reversal would refocus attention on $3500.1, the Apr 22 high and bull trigger.

Swedish April CPIF ex-energy confirmed flash estimates at 3.10% unrounded, still up from 2.97% in March but slightly below the Riksbank’s 3.15% projection from the March MPR. Overall, the details of the report feel supportive of the Riksbank’s dovish guidance tilt at the May decision. 

• As expected, the timing of Easter pushed up volatile travel-sensitive services items such as international flights (24.28% Y/Y vs -10.62% prior) and package holidays (11.22% Y/Y vs -1.61% prior).
• Meanwhile, there were more encouraging developments in other services categories:
  • Rents eased to 5.09% Y/Y (vs 5.23% prior).
  • Medical services fell to 3.07% Y/Y (vs 3.95% prior).
  • Recreation and culture services softened to 3.32% Y/Y (vs 3.98% prior).
  • Catering services fell to 3.84% Y/Y (vs 4.07% prior).
• Elsewhere, insurance remained firm at 5.65% Y/Y (vs 5.53% prior), while financial services saw an annual price reset to 4.19% Y/Y (vs 0.0% prior).
• Food inflation softened from March’s 15 month high of 4.74% Y/Y to 4.49% in April, even as coffee inflation spiked to 42.19% Y/Y (vs 29.99% prior).
• Core goods saw offsetting contributions from clothing and footwear (1.54% Y/Y vs 1.37% prior) and furnishings and household equipment (-1.24% Y/Y (vs 0.53% prior).
• Headline CPIF was 2.30% Y/Y (vs 2.34% prior), in line with the Riksbank’s 2.29% projection. Electricity and fuel inflation fell to 04.42% Y/Y (vs -2.66% prior).

The German government and European Union target the Russian energy, shipping, and banking sectors with further sanctions given Russia does not accept their demand of a ceasefire in the Ukraine conflict, according to a Bild report:

• "In the shipping sector, ship insurance for shipping companies and ships in the so-called shadow fleet, through which Russia illegally ships oil in violation of the sanctions, are to be targeted in particular."
• "In the banking sector, new punitive measures for individual banks that are active in Russia or involved in circumventing sanctions are being discussed. Russia is also being discussed for at least a temporary decoupling from the SWIFT payment system."
• "In the energy sector, gas imports from Russia are to be reduced to zero. At present, just under 20 percent of natural gas in the EU still comes from Russia."

Substantive sanctions against Russian banking, shipping and industry have been in place from the onset of the invasion into Ukraine, and measures including a clean severance from SWIFT have been proposed for several years - but may face internal resistance from the likes of Hungary and Slovakia, who maintain longer-term gas supply contracts with Moscow.