President Biden announces infrastructure plan

US equities were largely unmoved even as President Biden announced a huge $2.25 trillion infrastructure investment plan. This follows the $1.9 trillion COVID relief stimulus which has already passed. However, this new plan might be a more difficult ask to get enacted by Congress as it includes large scale corporate tax reform in order to pay for it, including hiking the corporate tax rate to 28% (from 21%), which most Republicans are likely staunchly opposed to

The Euro was little changed against the dollar and sterling remaining at $1.17 and 85p respectively even with news that the COVID-19 situation is worsening again in some parts of Europe with President Macron announcing that France will enter a month long nationwide lockdown from Saturday.  In bond markets, there was also relatively little movement with US 10-year yields at 1.71% and German 10-years at -0.29%

Oil prices fell a little on during Wednesday with a barrel of Brent crude down around 2% yesterday and trades at c.$63 this morning. The pressure is off a little with the Suez canal reopened and the market now looking towards the OPEC+ meeting today where there is a chance that countries many decide to increase production as they face into an upturn in demand when economies reopen and international travel resumes post-COVID

Euro Area flash inflation came in at 1.3% year-on-year in March, ahead of February’s 0.9% print but slightly below expectations. The increase in energy prices over the year was the chief driver of the bump in the rate, and this is also likely to push up the rate further in April

On the agenda today – initial jobless claims and ISM manufacturing due in the US, a light day ahead of US payrolls tomorrow