Equities & Bonds Stay Stead Ahead of US CPI Revision – Europe Market Wrap

Prior to the announcement of US inflation data that could change the narrative surrounding the Federal Reserve’s fight against inflation, global markets were hesitant to make any moves on Friday.

At 8:30 AM ET, the US is scheduled to release its annual revisions to its consumer price index. As it did the previous year, the revisions were significant enough to raise concerns about the overall trajectory of inflation and traders were once again speculating that the recalculations would change opinions about when the Federal Reserve would lower interest rates.

In a research note, Rabobank analysts stated, “This might have significant ramifications for the Fed. It could raise or lower the FOMC’s confidence in a sustainable return to 2% inflation.”

The US inflation print, which is expected on Tuesday, is the next important data point. Europe’s STOXX 600 and US stock-index futures saw no movement. 10-Yr Treasuries maintained stable, increasing their yield by roughly 15 BPS during the previous five days.

Bank of England’s Haskel: Lower inflation signs encouraging but insufficient.

Traders trim BoE rate cut bets, see fewer than 75 BPS this year.

Money Markets price in less than a 50% odds of a 25 BPS ECB rate cut in April.