Main exchange rates steady

The main exchange rates were largely unchanged yesterday, with the euro continuing to hover just below $1.06 against the dollar and just above 85p against sterling. The latter did regain a little ground against the dollar to trade back above $1.24

Equity markets were a touch lower and yields in core bond markets edged down. This has continued overnight (Asian stocks shed some ground and US 10-year yields fell by around 3bps) and suggests a slight ‘risk off’ tone in markets generally amid geopolitical concerns related to Syria and North Korea

Fed Chair Yellen says gradual interest rate increases ‘can get us where we need to be’. Where the Fed doesn’t want to be, she says, is ‘behind the curve’ as regards meeting its inflation target, which would  require it to ‘raise rates rapidly which could conceivably cause a recession’

Data published by the British Retail Consortium shows retail sales fell year-on-year for a third consecutive month in March, further evidence perhaps that (in the words of the Bank of England Governor) consumer spending in the UK is ‘coming off slowly’

CPI inflation data are published in the UK this morning. The headline rate is expected to have remained unchanged at 2.3% in March, according to the consensus forecast, while the core rate is expected to nudge down to 1.9%