The Easter holiday in Europe and a lack of scheduled publications in the US ensure a quiet trading session this Monday. Only a batch of data from China provides some volatility.

Chinese stocks were under moderate pressure on Monday, and the Chinese renminbi has changed little since the start of the day. Investors are concerned that the Peoples Bank of China did not ease its monetary policy on Friday or Monday, as many expected. In addition, retail activity is declining a worrying signal of the impact of lockdowns.

According to the released statistics package, the economy added 1.3 in the first quarter and is 4.8 higher than a year ago. This data is noticeably better than forecasts which expected 0.6 and 4.2, respectively.

Industrial production added 5 in March compared to the same month a year earlier, better than the 4.0 expected. However, the 3.5 yy drop in retail sales in response to last months tight lockdowns caught our attention more. To a large extent, they persisted or even intensified in some regions in the first half of April.

At the same time, the resilience of the Chinese renminbi cannot be overlooked. In no small measure, its ability to withstand a strengthening dollar is due to its tighter monetary policy. China seems to be paying more attention to the dynamics of the currency and economic indicators, disregarding the stock markets weakness.

Key equity indices China A50, Hang Seng, China Hshar are now below prepandemic levels, in stark contrast…