RUSSIA: CBR Expected to Deliver Another Large Rate Hike
Dec-20 08:41
- The CBR is expected to hike its key rate again this month amid a lack of improvement across the main inflation indicators. As per a Bloomberg survey, 10 out of 12 analysts expect a rate hike, though estimates range from a hike of as small as 100bps to as large as 300bps. See our full preview, with a summary of sell-side analyst views, here.
- President Vladimir Putin said in his annual call-in show that inflation in Russia is alarming, but otherwise the economy is stable and growing, Vedomosti report. He attributed high inflation to the overheating of the economy, lagging supply, world prices and higher logistics costs due to sanctions, but noted that real wages and disposable incomes are growing rapidly while unemployment is at a record low. Overall, Putin answered 76 questions during the event which lasted 4.5 hours.
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BUNDS: /SWAPS: ASWs Flat To Tighter, Long End Spreads Still Seem Most Vulnerable
Nov-20 08:38
This morning’s downtick in bonds leaves 3-month Euribor ASWs little changed to ~1bp tighter on the day, with the long end leading the tightening.
- This comes after yesterday’s 3-4bp of widening across the curve, which initially came on the back of risk-off trade surrounding the Russia-Ukraine conflict.
- Although that moved proved somewhat sticky, even as core global FI markets sold off in the afternoon
- Commerzbank dig a little deeper, noting “beyond risk-off, the tensions in term repos are showing tentative signs of easing and we see more room for markets to adjust into year-end.”
- This leads them to conclude that “this is in line with our view that repo and Schatz spreads should remain anchored, while the (ultra-) long ASW recovery looks more vulnerable once the focus shifts to next year's supply.”
US TSY FUTURES: Roll Pace
Nov-20 08:33
- US Rolls, rolling Treasury December Futures positions into March 2025 has started early this time around, this could somewhat make some sense with some US Desks looking to roll ahead of the Thanksgiving Holiday next week, and first notice on the 29th.
- Volumes in early trade is mainly in the 5yr (FVA), with well over a 3rd of the front Month volume spread related, and to the buy side, following selling interest so far this Week.
PACE:
- Ultra 30: 7%.
- TBond: 13%.
- Ultra 10: 3%.
- TYA: 7%.
- FVA: 9%.
- TUA: 8%.
SILVER TECHS: Corrective Cycle Remains In Play
Nov-20 08:10
- RES 4: $35.226 - 61.8% of the 2011 - 2020 major bear leg
- RES 3: $35.167 - 2.00 proj of the Aug 8 - 26 - Sep 6 price swing
- RES 2: $33.125/34.903 - High Nov 1 / High Oct 23 and the bull trigger
- RES 1: $31.566 - 20-day EMA
- PRICE: 30.908 @ 08:09 GMT Nov 20
- SUP 1: $29.677 - Low Nov 14
- SUP 2: $28.446 - 76.4% retracement of the Aug 8 - Oct 23 bull cycle
- SUP 3: $27.686 - Low Sep 6
- SUP 4: $26.451 - Low Aug 8
Medium-term bullish conditions in Silver remain intact and the bear cycle that started on Oct 23 appears to be a correction. However this corrective cycle remains in play and the metal is trading closer to its recent lows. Price has breached the 20- and 50-day EMAs, and traded through a trendline drawn from the Aug 8 low. This has exposed $28.446, a Fibonacci retracement. Initial firm resistance to watch is $31.603, the 20-day EMA.
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