Economic Data Confirmed Abated Overseas Inflation, US Dollar Continued to Weaken

Last week, numerous data were released. The US CPI in March increased by 5% year-on-year, which was lower than expected. The increase in non-farm payrolls in March reached the lowest level since December 2020. The slower growth of wages in March and the increase in initial jobless claims indicate that the support for consumption in the US service industry will weaken in the future.

In addition, the PPI in the United States increased by 2.7% year-on-year in March, which was lower than the previous 4% and the expected 3%. The slower-than-expected PPI further alleviated inflation concerns. The eased economic data and employment data indicate that the US economy is gradually cooling down at present.

The US dollar weakened remarkably last week due to market expectations over Fed interest rate cuts at the end of the year.

During the week, Eurostat announced that industrial output in the eurozone increased by 1.5% month-on-month in February, the largest increase since August 2022. This was in contrast with the forecast of 1.0% and the previous value of 0.70%. Industrial output in the European Union rose 1.4% month-on-month in February. It is necessary to continue to pay attention to the economic data related to the eurozone as there are still concerns that high inflation and high interest rates may plunge the economy in eurozone into recession.

China's CPI in March rose 0.7% year-on-year and fell 0.3% month-on-month. The average CPI from January to March rose by 1.3% over the same period last year. Resident consumption is still in the recovery process, but the recovery is relatively moderate. In the first quarter, RMB deposits increased by 15.39 trillion yuan, an increase of 4.54 trillion yuan year-on-year. Among them, household deposits increased by 9.9 trillion yuan. It is shown that residents' willingness to save is still strong.