US: Democrats Believe GOP Megabill Will Hand Them Advantage In 2026

• Date $MM Issuer (Priced *, Launch #)
• 04/22 $2B #State Street $700M 3NC2 +73, $300M 3NC2 SOFR+95, $1B 5Y +85
• 04/22 $1.85B #Kinder Morgan $1.1B 5Y +120, $750M 10Y +150
• 04/22 $1.1B #NY Life Global $700M 3Y +60, $400M 3Y SOFR+88
• 04/22 $750M #Brookfield Asset Management 10Y +140
• 04/22 $Benchmark OCP 5Y, +10Y investor calls
• 04/22 $Benchmark Rentokil investor calls

RRP usage climbs to $137.951B this afternoon from $114.114B yesterday. Usage had fallen to $54.772B last Wednesday, April 16 -- lowest level since April 2021. Conversely, usage had surged to the highest level since December 31, 2024 on Monday, March 31: $399.167B. The number of counterparties at 42.

• Fed Funds implied rates have pared some of their sharp shift higher when Bloomberg first reported that US Tsy Sec Bessent said at a closed-door investor summit that he sees de-escalation with China whilst the current situation is unsustainable.
• The trimming of the day’s increase has come with subsequent headlines from Reuters re it likely to be a “slog” and Politico reporting the US is close on Japan and India trade agreements but with details suggesting less progress.
• Going against the trimming somewhat, a modest tail in the 2Y Tsy auction at 1300ET.
• Cumulative cuts from 4.33% effective: 3bp May, 18bp Jun, 39bp Jul, 58bp Sep and 89bp Dec.
• SOFR implied yields currently see largest increases in the M6 (+8bp), whilst the terminal remains in the U6 as it climbs to 3.15% (+7.5bp) for almost one additional 25bp cut priced vs pre-Liberation Day levels.
• Today’s Fedspeak from Vice Chair Jefferson (permanent voter) and Harker (retiring June) hasn’t moved markets, seemingly taking a deliberately non-confrontational approach amidst Trump’s latest demands for lower rates. Still to come today:
  • 1340ET - Kashkari ('26 voter) at Chamber of Commerce Global Summit (Q&A only)
  • 1430ET - Barkin (non-voter) fireside chat at innovation summit (Q&A only)
  • 1800ET - Gov. Kugler (permanent voter) on monetary policy transmission (text + Q&A). She said Apr 7 that inflation was now the more pressing issue with regards to tariffs and that the Fed needs to make sure it doesn't rise. She warned the tariff impact should be consequential.