END OF DAY REPORT APRIL 13th

HIGHLIGHTS

US House Republicans are considering a proposal that would kick the debate over US debt limit to 2024; are readying legislation they could unveil next week that would suspend the debt ceiling until May 2024, according to Bloomberg sources
ECB's Kazaks says risk of recession is non-trivial and rates will need to go up more to tame inflation, according to CNBC; key issue is still very high inflation
ECB's Vasle says underlying inflation is moving in the wrong direction; mulling 25 and 50bps rate hike options for May
Chancellor Hunt to "look at" raising deposit guarantees in wake of SVB collapse after recent turmoil showed banks could fail more rapidly than in 2008 crisis, according to FT

SUMMARY

PPI final demand sank 0.5% in March to mark the biggest decline in almost three years, potentially a sign of further easing in inflation in the months ahead. The costs that wholsale pays for goods is another great inflation indicator and once you strip out the volatile food and energy component it rose a mere 0.1%.The PPI report captures what companies pay for supplies such as fuel, metals, packaging and so forth. These costs are often passed on to customers at the retail level and give an idea of whether inflation is rising or falling, so it does look like inflation is indeed slowing but the question remains if it’ll be quick enough for the FED to stop raising rates at the next meeting. S&P seems to think so as we head back for another charge at the recent highs, but remember that althought CPI was marginally weaker than expected it still is stubbornly high so we think there will still be a good chance of 25bp at the next meeting before they decide to pause.