The turnaround from -2.0% in February to +1.3% in March suggests a stabilization in consumer spending at major retail chains following a weaker start to the year. While the data do not detail category breakdowns, the shift back into positive territory indicates that large retailers managed to regain some momentum, potentially easing concerns about a sustained slowdown in Japan’s domestic demand. Investors and analysts will now be watching upcoming releases to see if March marks the start of a more durable recovery in the retail sector.

Both the current and previous readings are calculated on a year-over-year basis, comparing each month’s performance with the same month a year earlier. The February 2026 figure showed large-scale retail sales up 3.0% versus February 2025, while March 2026 sales were 2.0% higher than in March 2025, signaling a deceleration in the pace of annual growth.

The softer expansion in March suggests that momentum in Japan’s large-scale retail sector may be losing some strength after a more robust start to the year, an important development for analysts tracking the resilience of consumer demand in the country’s wider economy.

The “actual” May 2025 figure reflects the projected change in production compared with the previous month, while the “previous” 3.3% value indicates how April 2026’s forecast compared with March 2026. Although both readings remain in positive territory, suggesting continued expansion, the step down in the May forecast underscores a more cautious production stance among Japanese manufacturers as they adjust to evolving demand and operating conditions.

On a month‑over‑month comparison basis, the slowdown in the two‑month‑ahead forecast may signal that firms see less robust near‑term momentum than earlier anticipated, even as overall output is still expected to grow. Investors and policymakers are likely to watch subsequent updates closely for confirmation of whether this softer trajectory persists or stabilizes in the coming months.

The comparison is made on a month-over-month basis: April’s actual figure reflects the expected change in industrial production compared with March, while the previous indicator showed the expected change in March relative to February. The slowdown from 3.8% to 2.1% suggests that while Japanese industry is still forecast to expand, the pace of that expansion is expected to be more moderate heading into the coming month. Investors and policymakers will be watching subsequent releases closely to assess whether this signals a temporary pause or the start of a broader cooling trend in Japan’s industrial sector.

The figures are based on a comparison of March 2026 sales with those of March 2025, while the previous reading compared February 2026 with February 2025. The shift from a negative -0.2% in February to a positive 1.7% in March suggests improving momentum in household spending after a weak start to the year.

Analysts and market participants are likely to view the March data as a constructive signal for Japan’s domestic demand outlook, with the year-over-year improvement providing some relief after February’s contraction. However, sustained gains in retail sales will remain key to confirming a more durable recovery in consumer confidence and spending patterns.

The data, measured on a month‑over‑month basis, indicate that while the industrial sector is still contracting, the pace of decline has eased notably. The February reading reflected a steeper pullback in activity, whereas March’s figure suggests that the downturn may be moderating as producers adjust to earlier disruptions and weaker demand.

Market participants and policymakers will be watching upcoming releases closely to see whether March marks the beginning of a stabilisation phase for Japan’s industrial sector or merely a temporary pause in a broader slowdown. For now, the latest numbers highlight a sector still under pressure, but moving away from the sharper declines seen at the start of the year.

The figures, measured on a month-over-month basis, show that while production is still edging higher, the pace of improvement has cooled significantly compared with the previous month’s surge. February’s 5.3% gain reflected a strong rebound from earlier weakness, whereas March’s 0.3% reading suggests that industrial activity is stabilizing rather than continuing at the prior rapid clip.

The latest reading underscores a more cautious outlook for South Korea’s industrial sector heading into the second quarter, with markets likely to watch upcoming data closely for signs of whether March’s moderation marks a temporary breather or the start of a more prolonged slowdown in manufacturing momentum.

On a month-over-month basis, the latest figures indicate that activity in services — a key component of South Korea’s economy — gained traction heading into spring. The comparison shows that while February’s expansion was modest, March brought a significantly stronger pace of growth relative to the prior month’s performance.

The month-over-month comparison highlights a shift in consumer activity: while February’s negative reading indicated a pullback in spending, March’s positive result suggests a return of demand across the retail landscape. The “actual” figure for March reflects the change from February, whereas the “previous” figure captures February’s change relative to January, underscoring the contrast between the two months’ momentum.

The latest data will be closely watched by analysts tracking the strength of domestic consumption, a key component of South Korea’s economic performance, as they assess whether March’s rebound signals the start of a more durable recovery in consumer spending.

On a year-over-year basis, February 2026 industrial output had contracted by 2.3% compared with February 2025, underscoring weakness in activity at the start of the year. In contrast, March 2026 output was 3.6% higher than in March 2025, signaling a return to positive growth when measured against the same month a year earlier.

The move from negative to solidly positive territory suggests that industrial sectors may be stabilizing after recent volatility, with the March figures helping to ease concerns sparked by February’s downturn in year-on-year production.

Investors also weighed comments from RBNZ Governor Anna Breman on Wednesday, reiterating that the central bank remains focused on balancing inflation control with support for economic growth. Market participants looked ahead to the release of New Zealand’s April business confidence figures, after March registered the weakest reading since July 2024, as well as China’s PMI data later in the day, seen as key for gauging prospects in New Zealand’s largest trading partner.

Notable early decliners included Freightways (-1.4%), Mainfreight (-0.9%), Infratil (-0.8%), Delegat Group (-0.5%), and Hallenstein Glasson (-0.5%).

Both headline and core inflation have accelerated, moving further away from the official target. Inflation expectations for 2026 and 2027 remain above target, at 4.9% and 4.0%, respectively. Inflation risks are assessed as higher than usual, and projections indicate a growing deviation from the target over the policy horizon.

At the same time, uncertainty surrounding these projections has risen significantly, amid limited visibility on the duration of the US–Iran conflict and its potential effects. In this context, the Committee judged it appropriate to proceed with the ongoing monetary policy calibration cycle.

The 25-basis-point cut signals that policymakers are beginning to unwind one of the world’s highest benchmark rates, while still maintaining a restrictive stance to guard against inflation risks. The move suggests the central bank is seeking to balance support for economic activity with the need to keep price pressures in check.

Investors and businesses will be watching closely for indications of the future rate path, as any further easing could influence borrowing costs, investment plans and Brazil’s broader growth outlook in the coming months.

The Fed held rates steady, but several regional Fed presidents dissented against adopting an easing bias, highlighting persistent concerns over inflation. On the corporate front, Visa rallied 8% and AbbVie gained 3% after both reported strong quarterly results. In contrast, defensive stocks declined amid ongoing uncertainty in the Middle East.

Microsoft rose 4% during the regular session before slipping in after-hours trading, despite topping expectations for AI and cloud revenue. Alphabet advanced more than 3% after beating cloud computing estimates and reporting robust performance from its Gemini AI offerings. Amazon traded roughly flat after hours even though it significantly exceeded earnings expectations for the March quarter. Meta, however, tumbled 7% as investors questioned its sharply higher capital expenditure plans for AI.

At the same time, Mexico’s annual inflation rate eased to 4.53% in the first half of April 2026, down from 4.63% in March, even as global energy prices rose due to the Iran-related tensions. Core inflation also fell to 4.27%, its lowest level in five months, from 4.46%. This moderation in inflation has strengthened expectations that the Bank of Mexico may adopt a more dovish policy stance, adding to the downward pressure on the peso against the US dollar.

In contrast, the European Central Bank is expected to keep interest rates on hold at its meeting on Thursday. Nonetheless, markets are fully pricing in three 25-basis-point rate increases in 2026, reflecting persistent inflationary pressures linked to the oil shock triggered by the conflict with Iran.

Fresh data from Germany showed EU-harmonised inflation rising for a second consecutive month to 2.9%, the highest reading since January 2024. In Spain, the harmonised rate also quickened, reaching 3.5%, its highest level since June 2024.