Inflation in the USA and geopolitical tensions shape the markets.

Today's inflation data from the USA shows a clear increase. The CPI excluding food and energy rose by 0.4% in April on a monthly basis, exceeding forecasts of 0.3%. This index reached 2.8% year-on-year, which is higher than the expected 2.7%. Also, the so-called 'Supercore CPI', which excludes more volatile categories, increased by 0.45% m/m and 3.38% y/y. This data indicates potential inflationary pressures that could influence future Fed decisions. The market expects that at the next FOMC meeting, interest rates will remain unchanged, but rising inflation may prompt policymakers to change this approach in the future.

In the Middle East region, there have been undisclosed retaliatory strikes by Saudi Arabia against Iran, which may escalate the conflict in this area. Such actions could impact the stability of global oil markets, increasing uncertainty and potential volatility in commodity prices. In the context of global markets, these tensions may lead to an increase in risk premiums, which in turn could affect asset valuations across various classes. Investors will need to closely monitor the situation's development to assess potential implications for their portfolios.

Economic indicators from Germany show moderate stability. The final HICP index in April was 2.9% year-on-year, which is in line with forecasts and previous readings. The final CPI for Germany also remained unchanged at 2.9% year-on-year. The ZEW current conditions index did not surprise either, although it recorded a slight deterioration from -73.7 to -77.8. These data indicate some inflationary stabilization, but also challenges related to current economic conditions. German data may influence the decisions of the European Central Bank, especially in the context of interest rate policy.

Tomorrow may bring new reports from the Middle East that will be crucial for the commodity markets. Investors should also closely monitor any statements from Fed members that could suggest a change in approach to monetary policy in light of today's inflation data.