Important events today:

13:45 UTC – US: composite PMI.

Japan presented inflation data for March. The market was expecting a big drop in the consumer price index, but in practice the decline was only 0.1 p.p. to 3.2%. Inflation is still well above BoJ target but the new head of monetary regulator Kazuo Ueda is not ready at the moment to stop ultra-soft monetary policy, which was thought out by his predecessor Haruhiko Kuroda.

Ueda believes that negative interest rates in Japan will remain in place until at least the end of summer and thereafter, if inflation stays well above the 2% target, higher rates are possible. The real interest rate in the USA is now 0% and in Japan minus 3.4%. With that background investors have no choice but to take Buy positions on the downside, in anticipation of an uptrend offer.

Recommendations: Buy 133.51/133.19 and TP 134.30.