EU CAPITAL GOODS: AGCO (AGCO Baa2/BBB-[P]/NR): Moody’s Outlook Negative
Apr-02 10:17
Absent signs of a recovery for 2026, a future downgrade looks likely with metrics set to be well below rating levels.
- Moody’s has concerns for agricultural commodity recovery with tariffs likely to create drag. Tariffs should also affect equipment markets and rates are a further headwind.
- It sees AGCO’s Debt/EBITDA rising near 4x for FY25; it has a 3x threshold for the ratings. Using consensus figures, our adj. leverage would be ~3x, up from 2.2x at FY24 due to deteriorating revenue and margins. Previously our measure aligned well with Moody’s, but there is likely a gap following consolidated M&A.
- It expects EBITA margin below 6%, with consensus around 7.4% for a 220bp drop. Again, there are likely to be adjustment differences. It has a 10% trigger level.
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FOREX: Dollar Drifting Ahead of Revived Tariff Deadline
Mar-03 10:10
- EUR/USD edges to a new intraday high on the back of that EZ HICP print, but the pair was bid into the release already, with the USD further softer against all others in G10. EUR/JPY also trades well through the release, briefly showing above the Friday high.
- The impact has spilled over into new intraday highs for GBP/USD, which accelerates on the break of last Friday's high at 1.2622, but the mid-week highs and major resistance are still out of reach for now at 1.2716.
- No specific headlines or newsflow behind the USD drift, but markets likely well aware of the looming deadline for Canada/Mexico/China tariffs - due Tuesday at 0501GMT/0001ET - meaning markets will be on watch today for any signals of a last-minute extension, as was the case in February.
- Outside of Monday trade, the week is fraught with event risk - Tuesday marks the final deadline for additional trade levies on Canada, Mexico and China. The additional tariffs kick in at 0501GMT/0001ET on Tuesday - meaning markets will be on watch today for any signals of a last-minute extension, as was the case in February.
- ISM Manufacturing data for February is the data highlight, with sentiment in the spotlight this month thanks to growing signals in regional Fed releases that businesses are increasingly uncertain over tariffs and price pressures. Friday's MNI Chicago Business Barometer showed prices paid lurching higher, marking the largest one-month increase since July 1957.
USD: EURIBOR FIX - 03/03/25
Mar-03 10:03
EURIBOR FIX - EMMI/Bloomberg
- EUR001W 2.6220 0.0150
- EUR001M 2.4660 0.0030
- EUR003M 2.4640 0.0000
- EUR006M 2.3310 -0.0240
- EUR012M 2.3650 -0.0290
MNI: EUROZONE FEB FLASH HICP +2.4% Y/Y
Mar-03 10:00
- MNI: EUROZONE FEB FLASH HICP +2.4% Y/Y
- MNI: EUROZONE FEB FLASH CORE HICP +2.6% Y/Y
