A statement from China’s State Council on Sunday

• Will continue to suspend additional tariffs on U.S. vehicles and auto parts after April 1

Reuters reporting on Industrial and Commercial Bank of China (ICBC) and China Construction Bank Corp

• ICBC flat net profit for the fourth quarter, the first time it has seen no growth in a quarter since the July-September 2016 quarter
• Construction Bank posted a 1 percent drop in net profit, its first quarterly decline since the October-December 2015 quarter

• non-performing loan (NPL) ratios edged down by 0.01 percentage points at each bank
• both increased their provisions for future bad debt
• “We deeply feel it’s quite difficult to maintain the low bad loan level. There are external factors, our own reasons, problems with multi layers of local governments and other pressure,” said Xu Yiming, CCB’s chief financial officer, in Beijing on Thursday.”Do not think we are doing so well with 1.46 percent NPL ratio. It is very fragile. Once the environment changes, it can increase.”

Japan industrial production has slumped in the wake of trade tensions, Feb showing a bounce back from the very poor January result

• expected 1.4% m/m, prior -3.4%

-1.0% y/y, beat (not as bad as expected)

• expected -1.1% y/y, pri 0.3%

• March seen at +1.3%
• April seen at +1.1%

Japan retail sales for February

• expected 1.0% m/m, prior -1.8%

• expected 1.0% y/y, prior 0.6%

The US economy grew at a slower pace than expected in the final quarter of 2018, adding to the debate about the direction of interest rates this year.

Gross domestic product expanded by 2.2 per cent from a year ago in the final three months of 2018, according to the final revision of the national accounts by the Department of Commerce. That was down from the previous estimate of 2.6 per cent, and also below the 2.4 per cent increase pencilled in by economists in a Thomson Reuters survey.

That pace of growth is the slowest since the first quarter of 2018.

Multiple interest rate rises from the Federal Reserve through the year came home to roost in the final three months of 2018. The impact of these had begun to weigh on housing data, and the then likelihood of the US government going into shutdown mode over President Donald Trump’s attempt to secure funding for his wall on the US-Mexico border may have also weighed on consumer and business sentiment.

The Fed has taken a U-turn on policy in 2019 and last week said it did not expect to raise interest rates this year, citing a weakening global economy. Concerns in financial markets about a global slowdown — as well as the dovish stance from central banks — have fired up a solid rally in sovereign bonds this quarter.

Also out this morning were personal consumption expenditure data. The headline price index held steady at 1.5 per cent in the final quarter, while the core reading, which is the Fed’s preferred gauge of inflation, ticked up a tenth of a percentage point to 1.8 per cent.

Markets were relatively steady following the data releases. The dollar index remained about 0.4 per cent higher at 97.144, while S&P 500 futures were down 0.1 per cent.