Greetings,

Let's begin with China where we see further signs of economic improvement.

1. March industrial output, fixed asset investment, retail sales - all beat expectations. Stimulus starting to work?

Source: Investing.com

Source: Investing.com

2. China's new loans rose to CNY 1.37 trillion, topping expectations. Credit is flowing.

Here is a longer-term chart showing growth in all types of credit (total of 2.3 trillion yuan in new credit). Notice corporate bonds growing by the largest amount on record.

Source:  ‏@TomOrlik 

China's total debt burden (including local government bonds) continues to grow faster than the GDP.

Source:  ‏@alexfrangos, WSJ

3. The nation's housing market is hot again.

Source:  ‏@alexfrangos, WSJ

4. China's GDP deflator (the measure is used to convert nominal to real GDP) turned positive again. This indicates that output prices are no longer declining.

Source:   ‏@Callum_Thomas

5. Bloomberg's China GDP tracker suggests that the latest growth rate matches closely the estimation technique. While a number of market participants remain skeptical about China's official GDP, this measure suggests the official results are not too far from Bloomberg's estimate.

Source: @DavidInglesTV

6. The latest bounce in China's onshore markets did not seem to push up margin financing by brokers. At least the equity market is not getting re-levered (losses on levered portfolios and forced liquidations are fresh on investors' minds).

Source: @vikramreuters 

7. The last item suggests an increased correlation between China's H-share market (in HK) and global emerging market currencies. It shows the ongoing dependence of a number if EM nations on China's fortunes.

Source: Goldman Sachs

According to Bloomberg, "the RBA is getting worried now about home builders amid China-fueled property boom". Here is China's investment in Australian real estate (vs. everyone else).

Source: @GarfieldR1966 

We have 3 updates on the United States this morning.

1. The US headline and core CPI came in below consensus. This in part justifies the Fed's decision to further delay rate hikes. 

2. On the other hand, US labor markets continue to improve, as US initial jobless claims hit the lowest level since 1973. Note that this is not population adjusted. Jobless claims as a percentage of the working-age population are at record low.

3. US mortgage rates are at the lowest level in 3 years.

Next, we go to Europe for a few observations.

1. The Norges Bank is apparently dipping into the nation's sovereign wealth fund and buying 900 million Norwegian kroner per day to support the currency. That's why the krone and oil have diverged.

Source:@acemaxx, @MorganStanley

2. Swiss producer price deflation remains severe.

3. In the UK, the markets expect a BoE cut next instead of a hike. The BoE is at 50bp currently and will probably stay at that level for a while. The market sees the tail risk to the downside. 

Source: @fastFT

4. According to the IIF, "recent EU data are encouraging, driven by the domestic factor rather than the usual export dependence".

Source: @IIF 

Here are some observations on the Eurozone.

1. The currency bloc's CPI was adjusted from negative to zero - which should let Mario sleep better at night.

Source:  AP

Nevertheless, the Eurozone is still struggling with pockets of deflationary pressures. Here is Slovakia's CPI.

2. The IMF is becoming increasingly skeptical about Greece's ability to maintain the current debt burden.

Source: Irish Times

Now we have a couple of items on the energy markets:

1. The count of US idled oil wells has been rising as production activity slows. This suggests further oil output reductions in the US that are likely to accelerate soon.

Source: Goldman Sachs

2. Here is Iran's oil production.

Source: Goldman Sachs

Switching to credit, investors are moving back into energy junk bonds. 

Source: @FTMarkets

The correlation between HY bonds and oil remains high, with the recent rally in oil providing a great deal of support for leveraged finance products. This chart shows HY bonds and leveraged loans year-to-date relative performance.

Source: Ycharts.com

In the ABS markets, we see banks pulling out of holding this debt, as positions in bonds collateralized with auto debt hit fresh lows. Balance sheet and regulatory capital constrains are the reason.

Source: @fastFT

In the equity markets, ...

1... the chart below shows the evolution of ownership of the stock market.

Source:  ‏@bySamRo

2. Gap is running out of time.

Source: RBC, h/t Craig

3. The BofA had a really tough first quarter (IB stands for "investment bank").

Source: @bySamRo

Finally, in commodity markets we see hog futures falling sharply over the past fes days.

Source: barchart

Turning to Food for Thought, we have 5 items this morning:

1. Vietnam is the fastest growing trade partner for the US.

Source: ‏@FiveThirtyEight  

2. San Francisco leasing activity - not quite a bubble but getting there.

Source: ‏Colliers International, h/t Craig

3. Bottled water consumption about to surpass soda.

Source: @business

4. Do businesses want the UK to stay in the EU? For the most part yes, but there seems to be quite a bit of variation.

Source: @EconBizFin, h/t Jake

5. Who pays the most tax on their income?

Source:‏ @StatistaCharts, h/t Jake