It has been a busy weekend for news and because of this, the trading week is already off to a busy start. Indices in China and Japan rallied to start the week after China’s central bank announced more interest rate cuts over the weekend in a big to shore up its faltering economy. Note PBOC moves are always a surprise as they don’t hold scheduled meetings, but more rate cuts in Q2 had been widely anticipated. The UK, meanwhile, continues to bask in the glow of last week’s majority election decision in favour of the Conservatives. There had been a lot of concern that a hung Parliament could bring instability which continues to be unwound. Today’s Bank of England decision to maintain interest rates and QE came as no surprise, although its neutral stance at a time when so many central banks are easing leaves it out near the hawkish end of the spectrum. GBP is top performing major currency so far today on speculation that Wednesday’s inflation report could bring more direction from the central bank on when it may start raising interest rates and if it is prepared to move before the Fed. US stocks are holding steady to start the week, which could be read as a failure to continue Friday’s rally, or because the Dow hasn’t dropped back, as a sign of consolidation and continued support. There’s no major news for the US due until Wednesday’s retail sales report. Meanwhile, USD is bouncing back today, outperforming most other currencies, and knocking commodities back. Gold and WTI crude have been steady while Brent crude continues to retreat. NZD is getting hit hard again as traders increasingly speculate the RBNZ could be preparing to cut interest rates soon. European indices have been mixed today with the IBEX climbing while the Dax, CAC and MIB all lost ground. Similarly, continental currencies like EUR, NOK and SEK have been soft while treasury yields continue to creep higher. Although Greece indicated that it plans to make a big payment to the IMF this week, in the absence of other major news, Greece uncertainty continues to provide a headwind for the Eurozone. Corporate News There are no major corporate announcements today. Economic News Economic reports released overnight and this morning include: People’s Bank of China surprise cut its benchmark lending rate by 0.25% to 5.10% People’s Bank of China surprise cut its benchmark deposit rate by 0.25% to 2.25% Bank of England 0.25% and £375B no change as expected Sweden unemployment rate 3.8% vs street 3.9% Norway consumer prices 2.0% as expected Norway producer prices (5.6%) vs previous (6.1%) Greece industrial production 5.0% vs previous 1.9% China consumer prices 1.5% vs street 1.7% China producer prices (4.6%) vs street (4.4%) Economic reports due later today include: 9:45 am EDT ECB QE program purchase update