In response to the earlier release if the RBA’s April 7th policy meeting, JP Morgan says still believes the central bank will like lower the cash rate in May, although that decision looms as another close one


– Tomorrow’s CPI data is an important milestone and almost certainly will show headline inflation well below the RBA’s 2-3% target range.

– The core rate will be stickier, but with the annual change in the lower half of the range, this should leave the policy rate door open. 


DAILY METALS COMMENTARY: NOW AVAILABLE IN RESEARCH SECTION – Gold (+0.07%) traded relatively flat overnight with prices below the USD 1,200 level and in close proximity to yesterday’s lows following a rebound in the USD-index

Gold (+0.07%) traded relatively flat overnight with prices below the USD 1,200 level and in close proximity to yesterday’s lows following a rebound in the USD and strength in US equity markets pressuring the safe-haven metal.

Copper prices traded sideways providing respite from yesterday’s weakness across the metals complex, while Dalian iron ore futures continued to slump as spot prices remaining near it’s lowest in a decade after China steel mills is said to be restricting stockpiles in anticipation of further price falls.


US equities bounced back from last Friday’s selloff to close higher after China cut its RRR rate and following a number of strong earnings releases. The S&P 500 was supported by Hasbro (+12.5%) as they beat on EPS while the information technology sector was buoyed by IBM (+3.4%) ahead of their after-market earnings update. Finally, the DJIA finished up 1.17% at 18034.93, the S&P 500 finished up 0.92% at 2100.40 and the NASDAQ-100 finished up 1.51% at 4417.40.  Elsewhere, Asian stocks trade mostly in the black after taking the impetus from a positive Wall Street close, as US indices erased almost all of Friday’s outsized losses. Chinese bourses remained at the forefront of proceedings with the Hang Seng (+2.1%) now on course for its biggest gain in 1-week, after falling the most in 4-months late yesterday. Finally, the ASX 200 is up 0.58% at 5,867.20, the Nikkei 225 is up 1.02% at 19,835.07, the Shanghai Comp. is up 0.86% at 4,253.61 and the Sensex is down 0.53% at 27,765.51.

The USD-index broke above yesterday’s NY highs led by buying from Asia-based model funds, prompting USD/JPY to break above its 100 DMA at 119.32. AUD was the session’s laggard after extending yesterday’s sub-par performance amid jawboning from RBA Governor Stevens who also flagged further rate cuts. Moreover, today’s RBA’s April 7th meeting minutes showed that further policy easing may be appropriate in period going forward. Consequently, both AUD/USD and AUD/JPY broke below the 0.7700 and 0.9200 handles, which benefited the greenback.


Global Gold ETF holdings increased by 32,110 ounces to 52,139,060 ounces as of April 20th after Source increased holdings by 23,096 ounces on April 17th. (BBG)

Global Silver ETF holdings increased by 96,991 ounces to 622,223,458 ounces as of April 20th after Deutsche Bank increased holdings by 96,998 ounces on April 14th.  (BBG)

Global Platinum ETF holdings decreased by 1,722 ounces to 2,642,323 ounces as of April 20th after ETF decreased holdings by 2,062 ounces on April 15th while Global Palladium ETF holdings decreased by 7,869 ounces to 2,891,606 as of April 20th after ETF decreased holdings by 8,747 ounces on April 15th.  (BBG)

Rio Tinto Q1 iron ore output on a 100% basis rose 12% to 74.7mln tons vs. Exp. 82.7mln tons, while Q1 iron ore shipments increased 9% Y/Y to 72.5mln tons, which was a 12% decline Q/Q. Rio Tinto added it sees 2015 aluminium and copper output guidance unchanged. (BBG)

Turquoise Hill forecasts 600k-700k oz Oyu Tolgoi gold concentrates output and copper output at 175k-195k tons in 2015. (RTRS)

World Steel Association forecasts a continued decline in Chinese steel demand, which it sees falling 0.5% to 707.2mln tons for 2015 and a further drop to 703.7mln tons in 2016. (BBG)

China iron ore port inventories declined 1.18% to 94.75mln tons in the period of April 14th-20th. (RTRS)

Toyota said it intends to produce more than 1mln vehicles in China this year and keeps its eventual China sales of 2mln vehicles per year. (BBG)