Italy's industrial output unexpectedly increased significantly, analysis of short-term trends of spot gold, silver, crude oil and foreign exchange on March 14

Global Market Review

1. European and American market trends

The three major stock index futures rose, with Dow futures mainly blue-chip stocks rising by 0.63%; S&P 500 futures rising by 0.91%; and Nasdaq 100 futures mainly technology stocks rising by 1.19%. European stock markets rose, with the German DAX index rising 1.86%; the French CAC40 index rising 1.14%; and the UK FTSE 100 index rising 0.66%.

2. Market news interpretation

Italy's industrial output unexpectedly increased significantly, and its economic outlook still faces challenges

① Italy's industrial output increased by 3.2% month-on-month in January, far exceeding expectations. A Reuters survey of 13 analysts showed that the market was originally expected to grow by 1.2%. This figure aihuaforex.comes after a strong rebound in December's industrial output fell by 2.7% month-on-month (revised the 3.1% decline reported previously).

② Despite the strong January data, the Italian economy still faces many challenges. From the November-January quarter, industrial output remained the same as the previous three months, showing a stagnation in the overall economy. After adjustments to the working day, industrial output in January fell by 0.6% year-on-year, down for the 24th consecutive month.

③As the third largest economy in the euro zone, Italy's economic growth in 2024 was only 0.7%, lower than the government's expectations of 1%. In 2025, the Italian Ministry of Finance set a growth target of 1.2%, but this target is considered unrealistic by almost all independent institutions.

④ Italy's economic outlook remains subject to geopolitical tensions, possible trade tariffs from the United States and the distribution of RomeThe EU's COVID-19 recovery fund has been dragged down by factors such as the difficulties faced by the EU.

Analysis of European bond market expectations and interest rate trends

① Rohan Karnar, head of European interest rate strategy at Barclays London Branch, pointed out that the bond market generally expects that relevant economic stimulus plans will be approved, so Germany's 10-year government bond yields did not fall after a sharp rise last week. The market's optimistic expectations for policies have driven the continued rise in Treasury bond yields.

②Recent news reports about the near-reach agreement have further triggered a sell-off in European government bonds (EGBs), and this pressure is expected to continue in the short term. As bond prices fall, the yield curve continues to steeper, reflecting the increased market expectations for economic growth and inflation improvements in the medium term.

③ Currently, the market expects that the European Central Bank will lower interest rates to 2% by the end of this year and gradually raise them to 2.5% by the end of 2027. This expectation reflects the market's aihuaforex.complex view of the European economic outlook, including both short-term downside risks and medium- and long-term recovery potential.

Brazil's share of public debt to GDP unexpectedly fell in January

①Brazil's share of total public sector debt to GDP unexpectedly fell in January, lower than market expectations. According to Brazil's central bank data, the proportion fell to 75.3% from 76.1% in December, down from 76.2% forecast by Reuters economists.

② The central bank said that the 0.8 percentage point decline was mainly driven by the impact of net debt redemption and nominal GDP growth. In the month, Brazil's public sector achieved a primary surplus of 104.096 billion reais (about 17.92 billion US dollars), slightly higher than the 102.135 billion reais expected by Reuters' survey economists.

③The rolling deficit in the past 12 months accounts for 0.38% of GDP. The federal government's deficit in the past 12 months accounts for 0.37% of GDP. Brazilian President Lula da Silva's government aims to achieve a primary deficit of zero this year, allowing up and down to float a 0.25% GDP range.

The German debt agreement triggers market expectations and uncertainty

Richard McGuire, head manager of the interest rate strategy of the Bank of Netherlands, analyzed the impact of the German debt agreement. He believes that the market already has expectations for this agreement, which can be seen from the sharp sell-off in the bond market last week. Nevertheless, he noted that there may be limited room for further rise in bond yields.

McGuire mentioned that whether the yield on German government bonds (Bund) will exceed the upper limit of 3% will be a key point worth paying attention to in the future. He stressed that although the agreement is positive for Germany as a whole, there is still uncertainty about the speed of implementation of the plan. Whether funds can be deployed quickly is still a questionable question.

ECB Management aihuaforex.committee Holtzman supports keeping interest rates unchanged in April

ECB Management aihuaforex.committee and Austrian Central Bank Governor Holtzman (Robert Holzmann said in an exclusive interview on Friday that he supported keeping interest rates unchanged in April to cope with the inflation risks caused by rising trade tariffs and government expansion of spending. Holtzmann was the only aihuaforex.committee member to oppose the rate cut last week and he hopes more members will support his views at the April 17 meeting. He pointed out that the key to the next meeting is whether the aihuaforex.committee members who previously supported the rate cut but have expressed concerns will oppose further rate cuts. Still, the ECB may resume rate cuts in the summer, possibly as early as when a new economic forecast was announced in June. However, interest rates may need to be raised if tariffs, increased defense spending or Germany's easing of "debt brakes" leads to rising inflation.

Japanese aihuaforex.companies agree to the largest salary increase in 34 years, and it remains uncertain whether it can boost consumption. ① Japanese aihuaforex.companies agree to increase their salary by more than 5% this year, which is expected to be the largest salary increase in more than 30 years. While this is good news for many workers, it is uncertain whether pay raises will significantly boost consumer spending.

②As the annual labor-management negotiations end this week, many large Japanese aihuaforex.companies have said they have fully met the union’s wage increase requirements. Electronics giant Hitachi, for example, offers a record salary increase, but some industries are still excluded.

③ A substantial salary increase is seen as the key to aihuaforex.combating the sharp rise in living costs caused by inflation. Many aihuaforex.companies are also eager to retain their employees in a shortage of labor due to record profits from the depreciation of the yen. The Japanese government has long called on aihuaforex.companies to raise wages to break the cautious consumption mentality formed by ordinary people due to long-term deflation.

④ The initial salary increase of 5.46% this time is the third consecutive year that the basic salary has increased significantly, and it is also the largest increase in 34 years. However, economists fear that much of wage growth will be used to offset inflation. In January, Japan's core consumption inflation rate reached 4.0%, the highest in two years.

⑤Mitsubishi UF Research and Consulting chief economist Shinichiro Kobayashi said that the younger generation may be the biggest driving factor in consumer spending. He hopes that after three consecutive years of salary increase, young people's confidence in the future will increase.

⑥One of the key points of this salary increase is to increase wages for small business workers, whose employees account for 70% of Japan's labor force. Preliminary data show that the average salary increase for small businesses is 5.09%, exceeding 5% for the first time since 1992.

⑦ Despite this, some industries have not received a salary increase. For example, Japan's national hospital union requested a monthly base salary of 40,000 yen (about $270) was not responded to by management, resulting in about 200 workers strike on Thursday for a strike.

Russian energy official: Global oil demand will rebound with the driving season, OPEC+ has been taken into consideration

①Russian Deputy Prime Minister Alexander Novak said that with the arrival of the summer driving season, global oil demand will rebound in the next few months. This trend has been taken into consideration by OPEC+, the organization decided this month to increase oil supply from April, the first increase in production since 2022.

②Novak pointed out that although the International Energy Agency warned that global oil supply may exceed demand by about 600,000 barrels per day this year due to growth in U.S. oil production and lower than expected global demand, OPEC+ is ready to take action when necessary to deal with weak demand and oversupply. He also said market concerns about oil demand may be exaggerated.

③In addition, Novak mentioned that the issue of Russia's recovery of natural gas exports to Europe through the "North Stream" pipeline is not on the agenda at present, and negotiations to resume oil exports to Germany through the "Friendship" pipeline have not yet begun.

The UK economy contracted unexpectedly in January, and growth challenges intensified

① The UK economy contracted unexpectedly in January, highlighting the growth challenges faced by Chancellor Rachel Reeves. The United Kingdom's Office for National Statistics (ONS) data showed that gross domestic product (GDP) fell 0.1% month-on-month in January, while a Reuters survey of economists showed that the market was expected to grow by 0.1%.

②This economic decline was mainly dragged down by a sharp decline in industrial output, with a significant decline aihuaforex.compared with December. Although the January decline only partially offset the 0.4% increase in December, the result disappointed Reeves, whose core task is to drive economic growth.

③Reeves will release its spring budget report on March 26, when new economic and fiscal forecasts will be announced. The fiscal rules she previously set in her October budget are under pressure due to weak economic growth and rising borrowing costs. Reeves said fiscal rules are not aihuaforex.compromised and public spending will be cut if necessary to ensure it is not broken.

④ After the data was released, the pound fell by about 0.2 cents against the US dollar, and the market's expectations for the Bank of England to cut interest rates this year also accelerated slightly. Over the longer term, the UK economy grew only 0.2% in the three months to January, lower than Reuters' 0.3% consensus.

⑤ Hailey Low, an economist at the National Institute of Economics and Social Research, pointed out that the economy performed weakly in the second half of 2024, and current growth is still fragile due to global and domestic uncertainties. She stressed that the upcoming spring budget report should provide stability to avoid increasing domestic uncertainty and that frequent policy reversals may undermine business and investor confidence.

⑥ From an industry perspective, manufacturing output fell by 1.1% in January, among which the metals and pharmaceutical industries performed particularly poorly, and the reduction in oil and gas extraction also dragged down the entire industrial sector. Service output grew 0.1%, achieving monthly growth for three consecutive months, with supermarket sales rising, but bar and restaurant consumption declined, reflecting the tendency of British people to eat at home to save money. Construction output also fell by 0.2%, with ONS saying bad weather had a certain impact on construction activities.

3. The trend of major currency pairs in the New York Stock Exchange before the market

Euro/USYuan: As of 20:20 Beijing time, the euro/USD rose and is now at 1.0905, an increase of 0.49%. Before New York, the euro-dollar price continued to fall to a key support of $1.0830, and the price was still consolidating above that level, noting that the EMA50 provided positive support for the price, while the stochastic indicators showed new positive signals.

GBP/USD: As of 20:20 Beijing time, GBP/USD fell and is now at 1.2946, a drop of 0.01%. Before the New York Stock Market, GBPUSD price did not show any strong trend yesterday, testing the $1.2925 level and staying stable above that level to keep the bull trend effective and active for some time to aihuaforex.come, waiting for a visit to $1.3000 as the first major target.

Spot gold: As of 20:20 Beijing time, spot gold rose, now at 2997.94, an increase of 0.31%. Before the New York Stock Exchange, gold prices successfully hit the $3,000.00 mark and tried to break through to support the opportunity to continue to rise and realize more profits on an intraday and short-term basis, reminding you that the next stop will reach $3,055.00.

Spot silver: As of 20:20 Beijing time, spot silver rose, now at 33.994, an increase of 0.44%. Before the New York Stock Exchange, silver prices showed additional positive trades, trying to reach the $34.00 level, waiting to gather positive momentum to help drive prices up and achieve our next target of $34.50.

Crude oil market: As of 20:20 Beijing time, U.S. oil rose, now at 67.120, an increase of 0.86%. Before New York, crude oil prices showed more bullish tendencies to test EMA50, which forms intraday resistance around $67.20, waiting to exceed that level to strengthen expectations of a sustained bullish trend with a target of $68.35 as the next stop.

4. Institutional Views

Soycemel: The yield on 10-year German Treasury bonds will rise to more than 3% by the end of 2025

① Interest rate strategists at Societe Generale's research department said the department raised its forecast for the yield on 10-year German Treasury bonds, and is currently expected to rise to more than 3% by the end of 2025.

② They said in a report that this reflects the positive economic outlook of the eurozone led by Germany. According to their baseline forecast, the 10-year German Treasury bond yield was 3.20% in the fourth quarter. However, they said the prospects are not clear and will depend on the effective implementation of the German fiscal package.

③ Other uncertainties involved European defense spending, the possible situation of the Ukrainian war and the global macro forces in the escalation of the trade war, they said.

④ According to data, the 10-year German Treasury bond yield closed at 2.856% on Thursday.

Deutsche Bank: Bond market volatility weakens, but risks remain

Michael Leister of aihuaforex.commerzbank Research said that the volatility in the bond market is calming, although the trends of U.S. Treasury and German Treasury bonds remain somewhat out of sync after the astonishing decoupling of the cross-strait bond yields in recent weeks. "While Germany and the United States strengthened their political marginal game strategy, the achieved volatility continues to weaken, and the tariff threat is curbing risk sentiment," the interest rate strategy director said in a report. In Germany, a fiscal agreement is under discussion and no agreement has been reached on Thursday, "but a last-minute agreement remains our fundamental forecast," Leister said. The yield on the 10-year German Treasury bond rose by 1 basis point to 2.863%. According to data, the 10-year Treasury yield rose 1.7 basis points to 4.292%.

The above content is all about "[Ava Aihua Official Website]: Italy's industrial output has increased unexpectedly, and the short-term trend analysis of spot gold, silver, crude oil and foreign exchange on March 14" was carefully aihuaforex.compiled and edited by the Avatrade foreign exchange editor. I hope it will be helpful to your trading! Thanks for the support!

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