USD: BofA Maintain Medium-Term Bearish View, Risk Of Summer Rally Rising

• Spread set at MS+73bps (guidance was MS + 75bps area)
• HR: 88% vs 4.25% Jul-39 Bund (DE0001135325)
• Tap Size set earlier: E5bln (WNG) (the bottom of the E5-9bln range MNI expected)
• Final books in excess of E93bln (inc E5.9bln JLM interest)
• ISIN: EU000A3LZ0X9 (immediately fungible)
• JLMs: BofA (DM/B&D) / GSBE SE / NatWest / SG / UBS
• Timing: Hedge deadline 11:10BST / 12:10CET. Pricing later today

Buxl Block trade, suggest Buyer:

• UBU5 ~1.8k at 120.80.

• BOJ Governor Kazuo Ueda on Tuesday insisted that the BOJ will raise rates if necessary, but stressed uncertainty after a meeting which saw another hold as well as a decision to reduce the pace of its tapering of bond purchases following poor responses to 30-year government auctions. Following the decision and press conference, initial analyst reviews have adjusted their forecasts for the next rate move.
• TD Securities have changed their call, pushing out the next hike from July to October, which would take the target rate to 0.75%. They await further MoF guidance on issuance plans after this Friday's primary dealer meeting. They note that dovish remarks from Ueda were taken in stride by the market, which may reflect that investors have already priced in JPY weakness. Further out, TDS expect USDJPY to resume its downtrend, forecasting USDJPY <140 by year-end as structural factors weigh on the USD in H2'25.
• ING say the Governor's remarks at the press conference suggested a reinforcement of the dovish stance. This has prompted ING to further delay their calls on the timing of the next rate hike. They now see a clear dovish leaning from the BOJ and no rate hike is expected in the third quarter of this year. They add that if underlying inflationary pressures continue to build in the coming months, the BoJ may hike in Q4.