Yesterday the US Consumer Confidence and Richmond Manufacturing came out worse than expected continuing the lack of strength in the US data. Focus on US durables today, EURUSD to go higher?

Overnight News Bullets

• SW PPI MoM/YoY (Feb) out at 0.9%/4.9% vs. 0.3%/4.3% expected.
• SZ UBS Consumption Indicator (Feb) out at 2.031 vs. 1.947 prior.
• GE IFO (Mar): Business Climate at 107.7 vs. 106.5 expected, Current Assessment at 112.4 vs. 111.0 exp., Expectations at 103.2 vs. 102.3 exp.
• UK Total Business Investment QoQ(YoY (4Q F) out at 4.5%/13.5% vs. 3.3%/11.1% expected.
• US Consumer Confidence (Mar) out at 107.2 vs. 108.5 expected.
• US Richmond Fed Manufacturing Index (Mar) out at -10 vs. -5 expected.
• US ABC Consumer Confidence out at -2 vs. -5 prior.
• NZ Building Permits (Feb) out at 5.8% vs. 3.7% prior.
   

Markets

• FX: JPY strength coming back. GBP lower as BoE says inflation data not is surprising.
• Fixed Income: Bunds and 10yrs dropped y??™day. JGB??™s also lower today.
• Stocks: Europe a tad higher, US lower on Cons. Confidence. Nikkei down 0.6 pct. today.
• Commodities: Precious metals fell y??™day but have come back o/n. Oil touched 68.09 shortly, but has retraced to around $64/bbl.
   

O/N Data Heat map:

Calendar

Today's Highlights:

This and Next Week??™s Highlights:

What's going on?

• Crude oil rallies to 67 $/bbl on more tensions in the Middle East. Arab League draft encourages every Arab country to pursue a nuclear program (for scientific reasons ??“ ???yeah, right!???).
• USD is strengthening slightly on this ??“ but for how long. A majority in Congress is now forcing Bush to pull out US troops within the next year. This shows that the intervention has been a blatant failure. Not USD positive in the longer run.
• Credit Spreads are continuing to widen. Housing is still in the doldrums (at best). Leading Indicators are signalling a recession down the road. The yield curve is still solidly inverted and oil is going higher. This is bad for stocks, but we need a clearer technical confirmation of a downtrend.

FX