US Fed, ECB, BoE and BoC rates in focus

Bank of Japan (BOJ) kept rates on hold, as expected, but the vote narrowed to 6-3 from a prior 8-1 decision. Japanese Yen strengthened by -0.3% to 159. The BOJ also cut GDP growth projections to 0.5% for the current fiscal year while raising headline CPI to 2.8% and core CPI to 2.6%, both well above its 2.0% target. Additionally, the chances of a June hike for OIS fell slightly to 64.5% from 67% the previous day. Risk assets showed weakness, with Silver and Gold at two-week lows, US equities down, currencies softer, and Bitcoin declining. The Nikkei underperformed by -1%, extending earlier losses after the BOJ decision. Meanwhile, Iran-US conflict dynamics remained uncertain, with Secretary of State Rubio stating the US cannot tolerate Iran normalizing control of the Strait of Hormuz, but later indicating Supreme Leader Khamenei is alive and Iran’s proposal was better than expected. President Trump reportedly remains skeptical of Iran’s proposal. In Asia, the BOJ’s GDP and CPI updates highlighted economic concerns, while Middle East tensions persisted. Investors are closely watching upcoming central bank meetings (US Fed, ECB, BoE, BoC) and Q1 earnings reports, with a focus on economic indicators like US Consumer Confidence (Apr 28), AU Q1 CPI (Apr 29), and various regional economic data releases (KR Mar Retail Sales, JP Mar Industrial Production, CN Apr PMI, etc.). Key developments include: - **China**: Moody’s raised China’s economic outlook from Negative to Stable, citing sustained growth and effective debt management despite challenges. China also fired direct shots at tech companies leaving the market, rejecting Meta’s Manus deal and prohibiting foreign acquisitions in sensitive sectors. - **Australia/New Zealand**: ANZ Roy Morgan Weekly Consumer Confidence dropped to 63.5, while New Zealand’s Mar Filled Jobs rose to a 14-month high. Australia’s PM Albanese introduced new media bargaining legislation. - **Japan**: The BoJ’s decision led to a weaker Yen and broader market softness. Japan’s Mar Jobless Rate was 2.7%, and exports surged by 14.1% YoY. Japan’s Chief Cabinet Secretary Kihara warned of new AI threats. - **Korea**: Kospi opened slightly higher, and South Korea’s Apr Business Manufacturing Survey improved to 99.1 from 97.1. - **Middle East**: Iran-US tensions persisted, with US officials indicating skepticism toward Iran’s Strait of Hormuz proposal. The US may counter with new proposals. - **Global Markets**: US Treasury auctions drew strong bids, while global indices (Nikkei, ASX 200, Hang Seng) showed mixed performance. Commodities like Gold and Crude Oil saw minor fluctuations. Upcoming economic events include: - **Tue Apr 28**: US Apr Consumer Confidence. - **Wed Apr 29**: AU Q1 CPI, TH Rate Decision, CA BOC Rate Decision, US Rate Decision. - **Thu Apr 30**: KR Mar Retail Sales & Industrial Production, JP Mar Industrial Production, NZ Apr Business Confidence, PH Mar PPI & Trade Balance, CN Apr PMI, TW Q1 GDP, EU ECB Rate Decision & EU Apr CPI, UK Apr Rate Decision, US Q1 GDP & Mar Core PCE. - **Fri May 1**: AU Q1 PPI & Apr S&P Mfg PMI, JP Apr Tokyo CPI & Apr S&P Mfg PMI, KR Apr Trade Balance, US Apr S&P & ISM Mfg PMI. - **Holidays**: New Zealand, Vietnam (Apr 27), Japan (Apr 29), Vietnam (Apr 30), China/Hong Kong/India/Indonesia/South Korea/Malaysia/Philippines/Singapore/Taiwan/Thailand/Vietnam (May 1).