Dollar bounces ahead of busy end to April, eurozone GDP, US inflation data stand out

Markets are somewhat on the back foot after yet another record day on Thursday, while the dollar is stable after upbeat US GDP and ahead of additional figures. Cryptocurrencies have bounced from the lows, metals look strong while gold and oil are off the highs. End-of-month flows are eyed.

Global shares and S&P 500 futures are down in what seems like profit-taking after major US indexes hit new highs on Thursday. The Chinese Caixin Manufacturing PMI missed estimates with 51.1, below estimates.

On Wall Street, Amazon reported earnings that beat estimates, joining a long list of most robust figures published by large companies. Reports from banks are eyed on Friday.

US Gross Domestic Product came out at 6.4% annualized for the first quarter, within estimates and dragged down by a sharp drawdown in inventories.

Personal Income, Personal Spending, and Core PCE – the Federal Reserve’s preferred gauge of inflation – are due out on Friday. Significant increases are expected and they could raise concerns of an overheating economy.

US President Joe Biden has been promoting his twin plans worth a total of $4 trillion, yet investors are skeptical about what could pass Congress.

The US dollar is edging higher as 10-year Treasury yields have stabilized around 1.65% off the lows. GBP/USD is below 1.3950 and EUR/USD is hovering above 1.21.

Eurozone data: French GDP beat estimates with a quarterly increase of 0.4% in the first quarter, the first in a big bulk of eurozone growth and inflation figures. Germany is projected to report a squeeze of 1.5% in the first three months of the year, and the entire currency bloc is forecast to print -0.8%.

Preliminary inflation estimates for April are predicted to show a pickup in the headline Consumer Price Index from 1.3% to 1.6%, partly owing to base-effect. Core CPI is expected to drop. France and Portugal are the latest European countries to announce a loosening of restrictions as Europe advances with its vaccination scheme and COVID-19 cases fall.

Canada publishes monthly GDP figures for February, which are estimated to show an ongoing recovery.

Cryptocurrencies: Bitcoin is changing hands above $54,000, after suffering a dip earlier. Ethereum is holding onto its highs around $2,800 while XRP is surging and trading above $1.50.

End-of-month flows may cause choppy trading toward the end of the day, especially around the London Fix at 15:00 GMT.

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