BRAZIL: Bolsonaro Coup Trial To Start 2 September

• CANADA CONTRIBUTING CAD1B TO STEEL INNOVATION FUND
• CANADA SETS EXTRA 25% TARIFF ON NON-US STEEL POURED IN CHINA
• CANADA SETS 100% TARIFF QUOTA ON NON-US FREE TRADE-DEAL COUNTRIES
• CANADA PM CARNEY SAYS MEASURES PROTECT AGAINST TRADE DIVERSION

Reuters reports that, according to EU diplomats, the Union has once again failed to approve the 18th package of sanctions on Russia. EU ambassadors met for a Coreper II meeting in Brussels today after EU foreign ministers failed to reach a unanimous consensus yesterday, with Slovakia again the obstacle. The gov't of PM Robert Fico has held up the sanctions over another issue, the EU's planned phase-out of Russian fossil fuels. 

• On 15 July, Fico stated that EU assurances on ensuring a sufficient supply of hydrocarbons despite the phase out were "insufficient", risking a major escalation in tensions between Brussels and Bratislava. The phase out only needs a qualified majority, meaning Slovakia cannot block it. However, sanctions need unanimous approval, resulting in Slovakia holding up the package until its demands on the phase out are met. 

Fresh steepening in the US 2s10s curve on the latest headline, now at 61bps for the steepest since May 22. 10s30s also 4bps steeper today at 57.5bps, a fresh multi-year high.

• 2-year yields now down 8bps at 3.86%, but 10-year yields are down 1bp and 30-year yields up 3bps.
• A less politically independent Fed requires a higher risk premium for holding US Treasuries, and is driving the twist steepening of the curve here.