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Omnis Weekly What’s Important Next - 20 April 2026
Japanese Inflation
On Friday, we receive Consumer Price Index (CPI) data from Japan.
Why it’s important
The Bank of Japan has long operated in a low inflation environment, keeping interest rates close to zero for many years. Over the past year, this has begun to change, with Japanese interest rates moving materially higher. While rates remain low relative to global peers, there is still scope for further increases.
Markets have therefore been watching the Bank of Japan closely for an indication that is may accelerate the pace of tightening, particularly at the short end of the curve. This week, CPI is expected to edge up from 1.3% to 1.4%. Any suggestion that rising inflation to making the Bank more hawkish would likely be seized upon, especially in foreign exchange markets. Last week the yen broke through key resistance levels, potentially marking the beginning of a correction after a prolonged period of undervaluation.
Deal or No Deal
The US/Iran cease fire ends on Tuesday.
Why it’s important
Although markets have regained all their losses from the initial outbreak of war, the rhetoric over the weekend has turned markedly more negative. Vice President Vance is travelling to Islamabad once again, while at the same time President Trump has threatened strikes on Iranian bridges and power plants. This matters because the last ships that exited the Gulf before the conflict have now reached their destinations, and no further vessels are currently getting out.
Despite relatively calm market messaging, the reality on the ground is very different. In the US, gasoline spending by small businesses surged in March. In parts of Asia, fuel rationing has already begun, Globally, more airlines are cutting services, while farmers are facing sharply higher fertiliser costs. If the Straits do not reopen soon, shortages of fuel, transportation and agricultural inputs will become increasingly acute, potentially tipping the global economy toward recession. The world needs a deal and fast!