(CercleFinance.com) – The Paris Stock Exchange is expected to be in the red on Wednesday morning, with caution persisting against a backdrop of questions about the pace of disinflation and the monetary easing likely to result from it.
Around 8:15 a.m., the ‘futures’ contract on the CAC 40 index – expiring in April – was trading at 8119 points, down 25.5 points, suggesting a continuation of the consolidation of the day before.
Although inflation has been less of a concern recently, investors remain attentive to price developments, given that their decline has become an essential condition for rate cuts to materialize.
In this context, market participants will follow with interest, at 11:00 a.m., the publication of the first consumer price figures in the euro zone for the month of March.
Economists expect a stable figure of 2.6% at an annual rate for the core inflation index excluding food and energy last month and 3.1% for its overall version, again unchanged compared to February.
If the date of Easter – this year falling in March rather than April – could add volatility to certain prices, this data is likely to cause the euro and the benchmark bond yields of the Old Continent to react.
Because central banks have recently made it clear that their future decisions will depend on economic indicators and that they still need to be reassured about the future of inflation in general and wage pressures in particular.
For the European Central Bank (ECB), these data are therefore essential, since the Frankfurt institution seems reluctant to start its cycle of rate cuts before that of the Federal Reserve.
The most negative scenario for stocks would be if the long-awaited rate cuts do not take place, a scenario that could take shape if inflation were to start to rise again.
However, yesterday’s surge in oil prices proves that uncertainties regarding inflation can still be a source of volatility and resurface doubts about the timetable for rate cuts.
A new episode of tensions between Israel and Iran caused oil prices to rise yesterday following strikes carried out by the IDF on the Iranian consulate in Damascus (Syria).
North Sea Brent stabilized this morning around $89 per barrel while American light crude (WTI) also remained unchanged or almost unchanged at $85.
The market could also be tight while awaiting the speech by Jerome Powell, the chairman of the Federal Reserve, to Stanford academics.
Operators generally expect the Fed boss to reaffirm that the conditions for a rate cut are not yet met, given recent price disappointments, but that they could be within a few years. month.
In the United States, the ISM services index for the month of March – expected in the afternoon – should show that activity remains in slight expansion in the tertiary sector.
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