Data due today related to major FX is of lower importance. The Korean Consumer Price Index (CPI) is expected to show a small month-on-month decline while remaining consistent year-on-year.
In Australia, the March private inflation survey recorded a 0.7% increase month-on-month and a 2.8% rise year-on-year. The prior figures were -0.2% and 2.2%, respectively.
Reserve Bank Holds Steady
The Reserve Bank of Australia recently made the anticipated decision to keep rates on hold. Additional details and comments from Governor Bullock are available in Justin’s report.
The economic calendar for Asia on 2 April 2025 includes relevant data points with times noted in GMT, showing previous results alongside consensus expectations.
This morning, with the spotlight shifting away from headline FX data, traders watching the CPI release from Korea can reasonably anticipate limited market reaction. Forecasts suggest a mild monthly contraction, though the unchanged annual figure hints at a broadly stable inflation trend. There’s no strong case for surprise; markets are likely to regard this as a continuation rather than a turning point.
In Australia, more attention might be warranted. March’s inflation indicator showed a noticeable uptick on the month, reversing a prior dip. The rise to 0.7% is meaningful when viewed alongside the lift in the year-on-year figure from 2.2% to 2.8%. It’s not yet a drastic enough change to force central bank action outright, given that official rate policy was left unchanged recently. Still, the shift in these figures might begin to introduce a more cautious tone in future commentary from the Reserve Bank.
Traders Remain Cautious
Bullock gave little away during the post-decision press engagement, though a close read shows some light concern about upside risk to inflation. We’ve heard this before, but the data now offers fresher weight to those concerns. If this upward shift in prices continues over another month or two, it becomes increasingly difficult to argue for policy stasis.
For now, the trend is upwards but not alarming. Even so, any repricing in rates implied by bill futures could happen with little warning if the data strengthens again during Q2. Positioning across rates-linked contracts should reflect that reality—not necessarily by jumping to conclusions, but by avoiding too much reliance on last month’s trajectory being preserved.
On the calendar today, activity is leaner, but that does not imply silence. Times have been adjusted to GMT for direct comparison. Traders would do well to review consensus figures and keep track of any immediate shifts relative to those expectations—they remain reliable guides to intraday sentiment. There’s no need to over-analyse low-priority prints, but reaction to deviation is still tradable even when the data is treated as secondary.
We’re watching how follow-on commentary develops too. Minutes, Q&As, or informal briefings from monetary authorities sometimes share tone earlier than the markets do. Those willing to read between the lines may find early clues leading into larger policy realignments later in the quarter.
Keep watch on volume in the hours following data drops—not all reactions come in the first 15 minutes. There’s value in tracking which currency pairs walk back moves and which sustain them. It tells us more than headlines ever could.