Fra Danske Bank:
Emilie Herbo, [email protected] , Assistant Analyst
For mobile users we recommend the web-version * including the FI and FX morning comment
*Restricted access – only for professional investors and investors domiciled in and a resident of an EEA member state.
In Germany, the ZEW indicator for April will be released. The assessment of the current conditions rose last month, while expectations took a historically large hit. As the oil price has declined and the German equity index is up compared to the survey period in March, we expect to see a partial rebound in expectations as this often follows movements in the DAX index while the current situation is likely to decline.
In the UK, we get the February/March labour market report. The previous report added 60K jobs compared to earlier estimates and a feared surge in the unemployment rate was also avoided. In this report, we will particularly take notice whether the decline in wage pressure is broken. The KPMG jobs report suggested wage pressures weakened in March, a key argument for keeping rates unchanged in the Bank of England. On the back of the continued disruption in energy markets, we have removed our expectations of rate cuts and see the BoE on hold for the coming year.
In the US, March retail sales data is released, marking the first hard consumer data since the onset of the war in Iran. February retail sales surprised to the topside but did not reflect possible negative sentiment effects from the war due to timing of data collection.
Also in the US, Fed chair nominee Kevin Warsh will testify before the Senate Banking Committee at his confirmation hearing. A copy of his opening statement reveals that he will emphasise the importance of the Fed’s autonomy, stating his commitment to ensuring monetary policy remains ‘strictly independent’ and that inflation and price stability remain key mandates for the Fed.
Economic calendar
Oil prices trimmed gains from the prior session following reports that Iran will send a delegation to Pakistan for a second round of negotiations. Meanwhile, President Trump extended the current ceasefire to Wednesday evening Washington time, warning that further extensions are “highly unlikely” without a deal by then.
ECB President Christine Lagarde emphasised that the economic implications of the war in Iran have not yet reached the ECB’s adverse scenario. Despite rising energy prices, there is no clear evidence of second-round effects to justify rate hikes. Lagarde’s remarks suggest that the policy meeting on 30 April is likely too soon for any rate adjustments, as the central bank continues to gather more data. Last week, we tweaked our ECB call, pushing our expected rate hikes from April and June to June and July. See more in Reading the Markets EUR – From spring hikes to summer hikes; receive 2Y1Y ESTR swap, 16 April.
In Japan, Reuters sources said that “the BoJ is likely to hold off raising interest rates…” citing economic and price outlook uncertainty imposed by the war. We now expect the Bank of Japan to keep interest rates unchanged at the April meeting next week. While we think most conditions for a hike are still in place, the BoJ is unlikely to deliver any surprises. As such, we postpone our call for a rate hike to June, which markets currently price as a 50% probability, although this will largely depend on developments in energy markets.
In Canada, March headline inflation rose to 2.4% y/y (prior: 1.8%), slightly below expectations. The Bank of Canada’s closely watched core measures remained stable, and Governor Macklem stated on Friday that the central bank is not concerned about a temporary rise in inflation expectations. The print is likely to be neutral for next week’s Bank of Canada meeting, where we expect a rate hold in line with market pricing.
Equities: Global equities were somewhat lower yesterday in what initially seemed to be a complete reversal in terms of sector moves relative to Friday’s risk-on. That said, late-stage optimism of both US and Iran heading for Pakistan today (latter still to be confirmed) supported risk sentiment with a slight cyclical tilt and the more yield sensitive small caps performing (reflecting strong bank performance). Semiconductors ended its long 13-day gain streak yesterday with a minor decline. Global equities ended 0.3% lower, S&P 500 -0.2%, Nasdaq -0.3%, Russell 2000 0.5% higher. Overnight, US futures and Asian indices are in green.
FI and FX: Renewed uncertainty regarding the ceasefire between US and Iran sent the oil price higher, equities lower and global bond yields modestly higher on Monday with the ceasefire deadline looming Wednesday evening in Washington. However, EUR/USD has remained even surprisingly steady near 1.18 despite the rapidly shifting situation in the Middle East. While we think that the odds of a quick resolution to the war remain low, and a prolonged conflict remains a key downside risk for the cross, moderating energy prices have at least partially eased the negative terms-of-trade shock for now. USD/JPY traded near 159 overnight, as the Iran war continues to weigh on the JPY, with Japan being a large net-importer of energy. The NOK is once again proving remarkably resilient to the setback in risk appetite amid higher energy prices and an empty domestic data calendar. EUR/NOK is consequently back down below the 11.00 figure. Focus for GBP is today on the release of the UK jobs report.
See also our in-depth FI and FX morning comment *
Reading the Markets USD – Steady EUR/USD as SOH status in doubt , 21 April
Weekly Focus – Markets calming on peace hopes, 17 April
FX Forecast Update – USD erases war-fuelled gains as downtrend resumes, 17 April
Reading the Markets Norway – Stagflation risks: look for Red-Green and 2s10s bullish steepeners, 17 April
Reading the Markets EUR – From spring hikes to summer hikes; receive 2Y1Y ESTR swap , 16 April
Reading the Markets Denmark: The energy crisis has not hit consumption , 16 April
China Headlines – Solid exports and end to deflation, rising Chinese role in Iran war diplomacy , 15 April
Report completed: 21 April 2026, 07:00 CEST
Report first disseminated: 21 April 2026, 07:30 CEST
Disclosures/disclaimer
*For a definition of ‘Professional Investors’ under MiFID II (Market in Financial Instruments Directive 2014/65), go to the FAQ. To change your disclaimer settings, go to ‘Research Disclaimer’ at the footer of research.danskebank.com.
Hurtige nyheder er stadig i beta-fasen, og fejl kan derfor forekomme.
