SILVER TECHS: Bull Cycle Intact

ERU6 98.12/98.37/98.50 broken c fly, bought for 5.25 up to 5.5 in 5k.

DUX5 107.10c, sold at 5.5 in 3k (suggest closing).

ECB-dated OIS price 14bps of easing through July 2026, the first time markets have leant in favour of one more 25bp cut this cycle since the September 11 decision. The ESTR 1y1y rate has also inched back below the overnight rate. The majority of Friday afternoon’s dovish repricing on Trump’s China tariff threats has held, despite a softening in stance from the White House over the weekend. 

• A reintroduction of trade policy uncertainty and increase in US/China tariffs would have dovish implications for the ECB. Such an outcome would comprise recent optimism around the growth outlook (in September, the growth outlook was described as “more balanced”, with previous guidance suggesting there were “downside risks”), and potentially renew concerns around disinflationary Chinese trade diversion.
• ECB officials will want to see how the situation evolves in the coming weeks, with focus also on the heavy regional data calendar towards the end of this month.
• Euribor futures are little changed through the blues. As noted above, early flows in ERM6 reflect activity in the ESTR/ERM6 spread.
• This week’s regional calendar is light, headlined by final September HICP readings.