Swiss economy contracted by 0.2% in first three months of 2015.

Switzerland's economy contracted the most since the financial crisis in Q1 as the strong franc took a toll on exports. Gross domestic product fell by 0.2% in the first three months of 2015 compared to revised growth of 0.5% in the prior period. The outlook for the economy suffered a blow in January when the Swiss National Bank removed its currency cap, causing the franc to rally 15% vs. the euro during the quarter

France output contracted, while Germany manufacturing miss the target.

European stocks are on the decline amid mixed reports on the region's factory activity. France's output contracted less than economists estimated in May, but German manufacturing missed projections, signaling the region's largest economy is losing momentum. Markit's composite flash PMI for the eurozone also fell below analyst expectations, dropping to 53.4 in May from 53.9 in April.

Taking advantage of the lower borrowing costs in the eurozone, McDonald's and United Technologies are now the latest big U.S. companies to issue debt in euros (called "reverse Yankee" bonds), selling €2B and €750M, respectively. The total raised by U.S. companies issuing euro-denominated debt so far this year is just over €34B (not including the latest two deals), more than double the previous record of €17B in 2007.

India's Retail Inflation Down To 4.9% YoY In April

Consumer inflation continued to remain benign with the April recording inflation of 4.9% YoY. This is lower than March's 5.3% inflation (revised upward from 5.2% reported earlier). Core inflation slightly inched up to 4%, after hitting a three year low of 3.9%. Urban inflation was down to 4.4%, while rural inflation came down to 5.4%

Consumer inflation for April down to 4.9% YoY, lower than March’s 5.3%.

Lower food inflation has led to lower headline numbers; Core inflation inches up to 4%.

Pressure on inflation emerging from possible drought, higher crude oil prices and depreciating Rupee.

High possibility of central bank leaving policy rates unchanged in June, due to upside risks to inflation.

Another risk to inflation is from the depreciation of the Rupee, which has been under pressure for the past one month, primarily due to sell-off of local equities by foreign portfolio investors. INR was trading at 61-63 to the dollar for a long time, but has hit 64/USD during the last week and continues at those levels now. With India importing ~80% of required crude oil, the weakness in INR will translate to higher fuel costs, multiplying the impact of already higher crude oil prices.

Yields on German 10-year bond rise upto 0.73%

The vicious selloff in the European bond market has continued into another session, after German and U.S. bond yields surged to their highest levels in over five months. The startling rise in yields is making equities look more expensive in comparison to debt, keeping stock markets subdued. Yields on German 10-year paper are now up to 0.73%, having been as low as 0.59% on Wednesday, while U.S. 10-year notes have halted their slide.

The dollar index down,as retail sales data disappoints

The dollar languished at three-month lows today after poor U.S. retail sales proved a huge disappointment to those expecting some sort of U.S. rebound from a weather-weakened Q1. The key measure of sales was flat in April, adding to other disappointing data that could see the Fed postpone a rate hike and analysts downgrade their growth forecasts for the rest of the year. The dollar index last traded down 0.5% at 93.27. It has now shed nearly 7% from a 12-year peak of 100.39 set in March.

According to the latest report from the Energy Information Administration, oil production from seven major U.S. shale plays is expected to fall by 86K bbl/day in June. Oil output at the Eagle Ford shale play in South Texas is forecast to see the biggest decline, down 47K bbl/day, while production at the Bakken shale play, centered in North Dakota, is expected to drop by 31K bbl/day. Crude futures +1.9% to $60.39/bbl.