Retail sales volumes in the United Kingdom were flat in March 2024, following a revised 0.1% rise in February and missing the market expectation of a 0.3% growth. Increases in sales of automotive fuel by 3.2% and non-food stores by 0.5% were offset by declines in food stores and non-store retailers, which experienced decreases of 0.7% and 1.5%, respectively. Looking at the quarter, trade increased by 1.9% in the three months to March when compared with the previous three months. On a yearly basis, retail sales rose by 0.8%, rebounding from a revised 0.3% decline the month before.

European stocks fell on Friday, with the STOXX 50 dropping 0.7% to a six-week low, as investors scrambled for safety amidst escalating concerns of a broader regional conflict in the Middle East, triggered by reports of Israeli airstrikes against Iran. The market now awaits further clarification regarding the nature of the attack, particularly after a US official confirmed the incident, while Iranian media sources claimed no foreign assault on Isfahan or any other part of Iran. Additionally, hawkish remarks from Fed officials have dampened sentiment. NY Fed President Williams emphasized that the US central bank is not hastening to reduce interest rates, while his colleague Bostic suggested policy easing unlikely until the end of the year. On the corporate front, L'Oreal reported a 9.4% rise in Q1 sales on a like-for-like basis, while Sodexo stated that it expects organic revenue growth for 2024 to be at the top of its 6-8% range. Bookmaker 888 reported better-than-expected Q1 revenues.

The annual inflation rate in Japan ticked lower to 2.7% in March 2024 from February's 3-month peak of 2.8%, matching market consensus. There were slowdowns in prices of transport (2.9% vs 3.0% in February), clothes (2.0% vs 2.6%), furniture & household utensils (3.2% vs 5.1%), healthcare (1.5% vs 1.8%), communication (0.2% vs 1.4%), and culture & recreation (7.2% vs 7.3%). At the same time, inflation was stable for food (at 4.8%), housing (at 0.6%), education (at 1.3%), and miscellaneous (at 1.1%). Meanwhile, prices of fuel, and light dropped the least in a year (-1.7% vs -3.0%), with electricity (-1.0% and -2.5%) and gas (-7.1% vs -9.4%) falling at softer paces as energy subsidies from the government would fully end in May. The core inflation rate fell to 2.6% from a four-month top of 2.8%, slightly below forecasts of 2.7%. Monthly, consumer prices rose by 0.2% in March, the most since last October, after being flat in the prior two months.

Producer prices in Germany dropped by 2.9% year-on-year in March 2024, following a 4.1% fall in the previous month. It marked the ninth consecutive month of producer deflation but the smallest decline since July, driven by a fall in energy costs (-7.0%), influenced by natural gas (-15.4%), electricity (-12.6%), and mineral oil products (-1.0%). Meanwhile, prices of intermediate goods shrank by 3.7%, dragged down by metals (-6.6%) and basic chemicals (-9.0%). Conversely, prices of non-durable consumer goods rose by 0.3%, while those of durable consumer goods increased by 1.0%. Also, prices of capital goods climbed 2.8%, mainly boosted by advances in machinery prices (3.0%) and the prices of motor vehicles, trailers, and semi-trailers (2.2%). On a monthly basis, producer prices were up by 0.2% after a 0.4% decline in February, compared to forecasts of a flat reading.

Malaysia’ economy expanded 3.9% year-on-year in the first quarter of 2024, accelerating from a 3.0% growth in the previous period, preliminary estimates showed. It marked the fastest economic expansion in exactly a year, driven by positive contributions from all sectors, led by the services sector (4.4% vs 4.2% in Q4), particularly wholesale & retail trade, transportation & storage and business services sub-sectors. Additionally, output growth picked up for construction (9.8% vs 3.6%) and mining & quarrying (4.9% vs 3.8%), while production rebounded for manufacturing (1.9% vs -0.3%). In contrast, agricultural activities grew at a slower pace (1.3% vs 1.9%). On a quarterly basis, the GDP shrank 3.4% compared to a 3.1% rise in the prior period.

Gold climbed past $2,400 per ounce on Friday, climbing back to record highs, and on track for its fifth weekly gain, as investors flocked towards the safe-haven, driven by rising geopolitical risks in the Middle East. Early on Friday, a US official confirmed that Israel launched a missile attack on Iran, targeting its unmanned aerial vehicle production as a retaliation to Iran’s unprecedented assault last week. The heightened geopolitical tensions overshadowed the recent hawkish remarks from several Federal Reserve officials. On Thursday, Atlanta Fed Bank President Bostic and NY Fed President John Williams emphasized that the US central bank is not rushing to cut rates in the near term amid persistently high inflation figures.