US economic data were light. Q1 2017 earnings season began with several large US banks reporting stronger investment banking and trading activities, but slowing lending growth. The March Producer Price Index (PPI) increased 2.3% y/y, the highest level in five years. The March Import Price Index decelerated to a 4.2% y/y gain.
In Europe, March German and French Consumer Price Indexes (CPIs) rose 1.6% y/y and 1.1% y/y, respectively. French politics generated headlines ahead of the first round of the presidential election after far-left candidate Jean-Luc Melenchon jumped in the polls, although he remains in fourth place. In the UK, March Core CPI rose less than expected, up 1.8% y/y, and February home prices increased 5.8% y/y.
In Asia, March Chinese CPI mildly accelerated to 0.9% y/y, while PPI decelerated, though still rising at 7.6% y/y. Following his meeting with Chinese President Xi Jinping, President Trump announced the US will not label China a currency manipulator. North Korea grabbed headlines concerning nuclear weapons tests and the Trump administration responded by sending a naval group toward the Korean peninsula, threatening sanctions and calling on President Xi to help rein in North Korea. As always, geopolitical tensions can change quickly but regional conflicts are unlikely to derail the global economic expansion or bull market.
The US releases March CPI, retail sales, industrial production and the Leading Economic Indicators. In Europe, March German PPI and UK retail sales data are due. China releases March lending, money supply and retail sales along with Q1 GDP.
Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses a Luxembourg tax basis. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.