EGB OPTIONS: Bund call spread buyer

It's a hugely busy week with the Fed, BOE and ECB all announcing their latest interest rate decisions while we will also receive flash inflation prints across Europe ahead of the ECB decision.

• In terms of inflation we will receive Spain HICP this morning at 8:00GMT / 9:00CET with Belgian CPI also due for release today. Tomorrow morning will see French, Portuguese and Irish releases with Germany due in the afternoon (note that there will be no state CPI data, just the national CPI / HICP prints). On Wednesday we will then receive Dutch HICP, Austrian CPI and then at 10:00GMT / 11:00CET we will receive both the Italian and Eurozone prints.
• For the Fed on Wednesday a 25bp hike is widely expected, a downshift from December's 50bp hike. The dovish risks to this meeting appear at least partly priced in, including some expectations of Statement language acknowledging decelerating inflation, or a clear signal that the end of the hiking cycle is near. However, there are many ways Powell could re-emphasize the FOMC’s view that the job is not nearly done yet. Powell will again steer attention away from the pace of hikes and toward the terminal level (which the FOMC envisages as higher than the market does), while pushing back against rate cut pricing for H2 2023. Market terminal rate pricing sees around 58bp of hikes including this week's 25bp. For our full Fed preview see here.