Today’s Trading Playbook
KEY THEMES
Yesterday, inflation figures for February came out, showing a slight uptick in annual headline inflation from 4.3% to 4.5%. The readings represent an interruption to the disinflation trend; however, we still see demand-side pressures not materializing. Such a view was later validated by the core inflation readings which remained unchanged at 3.6% from an annual perspective, yet dropped on a monthly basis from 0.5% to 0.3%. Despite weak demand-side forces, cost-driven factors started to appear on the horizon from the recently changing dynamics in the global commodity market, especially food prices. In view of the recent inflation figures, we see the next MPC meeting likely to result in interest rates kept unchanged. For more details, please read our MACROView note, published yesterday.
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