Asian equities are mixed in spite of the rebound in US stocks over night. And, markets had little reaction to the new sanctions against Russia announced by the US and EU. US president Obama said there will be seven Russians and seventeen companies to be included in the sanction list. Obama said that will remain "targeted" and "focus on some areas of high-tech defense exports to Russia". Meanwhile, the EU added fifteen more names to the list of persons subject to targeted sanctions for the actions "undermining Ukraine's territorial integrity, sovereignty and independence." The EU's sanctions include travel ban and asset freeze within EU. In the forex markets, commodity currencies extended their pull back against dollar while European majors are firm. However, Sterling struggled to extend gains against the greenback ahead of today's Q1 GDP report.
In the Eurozone, it's reported that ECB president Draghi told German lawmakers that the central bank is unlikely to engage in QE. Meanwhile the Bundesbank said in a report that there is no risk for deflation for Germany to tackle yet. Meanwhile, the Bundesbank also noted that higher inflation isn't a cure to Europe's problem, and it's no substitute to fiscal disciplines. It noted that, "because neither high inflation nor state insolvency is a desirable macroeconomic result, a sustainable fiscal policy based on manageable public finances is the basis of positive economic development."
The main focus in the European session will be on UK Q1 GDP, which is expected to show 0.9% qoq growth. That's an acceleration from Q4's 0.7% qoq. GBP/USD has struggled to maintain gain yesterday after breaching 1.6841 briefly. And today's report is crucial on giving it momentum to get through 1.7 psychological level. The EUR/GBP also struggles to head back to 0.8157 support. Other data to be watched include Eurozone M3 and confidence indicators and German Gfk and CPI. The US will release the S&P case-shiller house price and consumer confidence. Released earlier, New Zealand trade surplus widened slightly more than expected to NZD 920m in March.