Italy 10-y Bond Auction declined to 3.77% from previous 4.09%

Italy 5-y Bond Auction: 3.16% vs previous 3.32%

South Africa Producer Price Index (MoM) up to 3% in April from previous 1.1%

South Africa Producer Price Index (YoY) rose from previous 2.3% to 4.8% in April

Belgium Consumer Price Index (YoY) increased to 4.08% in May from previous 4.07%

Belgium Consumer Price Index (MoM) declined to -0.08% in May from previous 1.47%

MUFG’s Derek Halpenny and Abdul-Ahad Lockhart report that the AUD/NZD rally may have peaked as rate differentials begin to turn. They stress that the Reserve Bank of New Zealand (RBNZ) signalled forthcoming hikes, while the Reserve Bank of Australia (RBA) can pause longer.

TD Securities’ Prashant Newnaha shifts the Reserve Bank of New Zealand (RBNZ) call to start 25 bps hikes in July rather than September, keeping a total of four moves in the profile.

Eurozone Consumer Confidence meets expectations (-19) in May

Italy Trade Balance non-EU: €3.846B (April) vs previous €5.643B

ING economists Carsten Brzeski and Bert Colijn expect the European Central Bank (ECB) to deliver a single ‘insurance’ rate hike in June, largely because markets have already tightened financial conditions and inflation pressures are creeping higher.

European Central Bank (ECB) governing council member and Governor of the Bank of Greece, Yannis Stournaras, said in an interview with Greek newspaper Kathimerini that took place on Wednesday, released during the European trading session on Thursday, that the current environment necessitates a "caref

ABN AMRO notes the Fed kept rates at 3.50–3.75% in April and signalled no consensus to ease until tariff-driven goods inflation moderates. With the Oil shock lifting headline inflation, the bank expects the Fed to stay on hold until December to assess second-round effects.

Portugal Business Confidence: 2.7 (May) vs 2.6

Portugal Consumer Confidence declined to -27.1 in May from previous -23.9

Commerzbank’s Volkmar Baur expects the South African Reserve Bank (SARB) to deliver a fully priced 25 bps hike to 7.00%, with markets discounting roughly three hikes to 7.50% in coming months.

Deutsche Bank’s Jim Reid highlights that global equities have turned lower after new US strikes and sanctions on Iran, following a session where US indices hit fresh record highs.

Italy Consumer Confidence came in at 93.4, above expectations (90.1) in May

Italy Business Confidence came in at 87.9, above forecasts (87.5) in May

BNY’s Geoff Yu argues that steepening in G10 bond curves and stagflation concerns are generating fixed income-based rebalancing signals that should benefit the Pound and Japanese Yen.

An Iranian Foreign Ministry spokesperson said during the European trading session on Thursday that Tehran strongly condemns United States (US) strikes near the Strait of Hormuz, a critical passage to almost 20% of global energy supply, calling these strikes a continuous violation of a ceasefire.

ABN AMRO analysts note the European Central Bank (ECB) Governing Council has adopted a tightening bias and is expected to raise the deposit rate to 2.50% with hikes in June and July. Higher long-term inflation expectations support this stance.

Stock markets in Asia have recovered a majority of their early losses, but are still significantly down as the exchange of attacks between the United States (US) and Iran has escalated the Middle East crisis.

Spain Retail Sales (YoY): 0.8% (April) vs previous 4.1%

Danske Bank’s Danske Research Team notes that global equities paused and are set to open lower as Oil prices and yields move higher following renewed US-Iran tensions.

Switzerland Employment Level (QoQ): 5.537M (1Q) vs previous 5.544M

Sweden Trade Balance (MoM) down to -7.3B in April from previous 9.3B

The United States (US) Bureau of Economic Analysis (BEA) will publish the Personal Consumption Expenditures (PCE) Price Index data for April on Thursday at 12:30 GMT. 

Citing Tasnim News Agency, Reuters reported on Thursday that Iran’s Islamic Revolutionary Guard Corps (IRGC) said it targeted the US airbase in response to attack near Bandar Abbas airport.

The United States (US) Treasury Department said on Wednesday that it has sanctioned the Persian Gulf Strait Authority, the body Iran has set up to manage the Strait of Hormuz, the conduit for about a fifth of the global oil supply.