US inflation is in sight
The market awaits US inflation data. March economists anticipate headline CPI at 3.4% YoY, higher than the 3.2% in February. This increase is partly due to the recent rise in energy prices.
The Reserve Bank of New Zealand
Kiwi rates have been maintained, as expected. The official cash rate stays at 5.5%, extending the rate pause for a sixth straight month. The Reserve Bank of New Zealand (RBNZ) committee agreed that interest rates will need to remain at a restrictive level for the foreseeable future. If New Zealand's annual inflation has come off in recent months, it is still currently at 4.7%. The RBNZ forecasts it will return to its target band of 1-3% this calendar year.
The Bank of China
The Bank of China (BOC) interest rate decision is due later on Wednesday afternoon. No change is expected there either. The overnight rate is forecast to remain at 5%, leaving borrowing costs at a 22-year high. However, fears that the spring housing market could "overheat" will be in the background. The spring housing market, which kicks off in March, is typically one of the busiest times of the year for home buyers and sellers in Canada.
European Central Bank
The European Central Bank (ECB) interest rate decision will be on Tuesday. Despite inflation falling in the eurozone, the ECB's main refinancing rate is forecast to remain at 4.5%. No change is expected either for the deposit facility rate or the marginal lending rate.
Nonfarm payroll
Last Friday, March nonfarm payroll (NFP) came well above expectations at 303,000. As a result, expectations of a rate cut in June have diminished. Now the market awaits US inflation data. March economists anticipate headline consumer price index (CPI) at 3.4% year-over-year (YoY), higher than the 3.2% in February. This increase is partly due to the recent rise in energy prices.
The Federal Reserve
At 7 p.m. UK, the Federal Reserve will release the minutes from its March meeting. It held rates steady, with the updated dot plot showing Fed officials expecting three rate cuts this year amounting to 75 basis points.
Tesco
Tesco forecasts a further increase in retail profit in 2023–24, after posting a 10.9% rise for the full year. UK like-for-like sales rose 7.7% in the period.
Delta Air
Delta Air Lines will post its earnings for the first quarter before the market opens. Expectations are for earnings of 34 cents per share on revenue of £12.46 billion. The resurgence of holiday and business activity will make the airline sector one of the strongest in 2023. What about 2024? According to International Air Transport Association (IATA), the global airline industry should see its profits increase by 10% year over year. Delta Air Lines, all session stock on the IG platform, has been up more than 50% since October lows. Analysts expect an EPS increase of 36%, but the group's forecast will be what investors are looking for. Three months ago, Delta Airlines earnings per share (EPS) doubled, but at the same time, the group trimmed its 2024 earnings forecast. The stock, as you can see on this chart, dropped nearly 9% that day.
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