Market News

• Business confidence 94 vs 94 expected
• Prior 94
• Services confidence 93
• Prior 94
• Industrial confidence 102
• Prior 100

More to come..

• Retail sales -1.3% vs -0.6% m/m expected
• Prior +0.7%; revised to +0.6%
• Retail sales 0.0% vs +1.3% y/y expected
• Prior +1.7%; revised to +1.4%
• Retail sales (ex autos, fuel) -0.4% vs -0.3% m/m expected
• Prior +0.2%; revised to +0.1%
• Retail sales (ex autos, fuel) +1.1% vs +1.5% y/y expected
• Prior +1.7%; revised to +1.5%

Well, the negative impact stirred up by the Middle East conflict is starting to make its mark now. The biggest drop dragging down retail sales for the month comes from automotive fuel sales (-10.2%). But even when you strip that out, the overall picture is still a poor one with marked declines seen in sales for textile, clothing, footwear (-2.4%) and non-store retailing (-2.0%).

Retail sales volumes are now seen 1.7% lower compared with…

• Prior -33.3

More to come..

• Prior +0.3%

More to come..

This just reconfirms what was already aired by the IRNA. The meet up again is "to review proposals for resolving the ongoing dispute with the US". For some context, this was Mohsin Naqvi's second trip to Tehran in less than a week as Pakistan continues to step up mediation efforts in trying to get something done.

That being said, Iran foreign minister Araghchi was quick to dismiss this as being a breakthrough moment in calling out the US on its "contradictory, excessive, and hypocritical behaviour". He did thank Pakistan for its mediation efforts though.

So, it remains to be seen if there will be anything done by the weekend. And if not, we're going to be in for another week of constant back-and-forth with the same headlines all over again…

There have been plenty of mixed headlines in the past 24 hours. So, let's do our best to catch up and make sense of what is happening in the Middle East conflict.

First, there was that report yesterday that Iran's supreme leader had issued a directive calling for near-weapons-grade uranium stockpile to not leave the country. That was subsequently denied by another report, although it stated that Iran's position on the matter has not changed. That being Tehran wants to keep the stockpile in the country and if worse comes to worse, will just blend it down. But for now, the matter is still an "active subject of negotiations".

Besides that, there were other headlines on chatter that the US and Iran are poised to reach a framework agreement -…

• RBNZ set to hold at 2.25% but majority now see hikes coming by end-September
• ING expects June BOJ rate hike despite softer than forecast Japan CPI
• Beijing's state planner softens tone on foreign investment in Chinese technology sector
• Oil seen capped near $100 as Iran war demand destruction offsets supply loss
• Alberta to hold October referendum on whether to begin separation process from Canada
• Reserve Bank of India (RBI) set to hand 3.05 trillion to government in record transfer
• PBOC sets USD/ CNY reference rate for today at 6.8373 (vs. estimate at 6.7992)
• US markets face shortened Friday and full Monday closure for Memorial Day
• Japan core inflation hits four-year low in April but war-driven rebound seen ahead
• Japan Core inflation rate 1.4% y/y…

China's NDRC said it never told Chinese tech firms they could not accept US investment, adding that foreign capital must comply with Chinese law and must not harm national security.

Summary: Source: China's National Development and Reform Commission (NDRC), via newswire

• The NDRC, China's top economic planning body responsible for setting national investment and development policy, said it had never instructed Chinese technology companies to refuse foreign investment
• Foreign investment is welcome but must comply with Chinese laws and regulations
• Any foreign capital must not be seen to harm China's national security or national interests
• The NDRC confirmed it is preparing supporting documents to accelerate the implementation of artificial…

Alberta Premier Danielle Smith has confirmed a non-binding October referendum asking residents whether the province should begin the legal process toward a possible independence vote.

Summary: Source: Reuters, citing Premier Danielle Smith's televised address and provincial legislative committee recommendations

• Alberta Premier Danielle Smith confirmed the province will hold a non-binding referendum in October on whether residents want to remain part of Canada
• The ballot will not trigger separation but will ask whether the government should begin the constitutional legal process required before a binding independence referendum could be held
• The vote would be the first time a Canadian province outside Quebec has put a separation question to…

UK consumer confidence beat forecasts in May at -23, while Irish sentiment rebounded sharply from a 40-month low, though both surveys point to households still firmly on the defensive.

Summary: Sources: GfK Consumer Confidence Survey (UK); Credit Union Consumer Sentiment Survey (Ireland) - collated by Reuters.

• The UK GfK consumer confidence index rose to -23 in May from -25 in April, beating a Reuters poll forecast of -28; April's reading had been the lowest since October 2023
• GfK's major purchase intentions gauge fell two points to -20, its weakest level since January 2025, with lower-income households particularly reluctant to spend
• A savings measure dropped 10 points, suggesting UK consumers are drawing on reserves to cover everyday…

Japan April inflation data:

Headline CPI (Y/Y) 1.4%

• expected 1.6%, prior 1.5%

CPI Excluding Fresh Food (core CPI) 1.4%

• expected 1.7%, prior 1.8%

CPI Excluding Fresh Food, Energy (core-core CPI) (Y/Y) 1.9%

• expected 2.2%, prior 2.4%

I'll have more to come on this separately, details and implications etc. The TL;DR is going to be this is not going to prompt BoJ rate rise urgency.

New Zealand Retail Sales Q1 2026

+0.9% q/q

• expected +0.6%, prior +0.9%

+4.5% y/y

• prior + 4.4%