STIR: ECB Pricing Little Changed, Schnabel Stresses Need For Higher Rates
Aug-26 07:04
EUR front end pricing also fairly steady to start the day, with a hike over 95% priced for September...
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STIR: ESTR 1y1y down 6bps On Cautious Middle East Optimism
Jul-27 07:02
ESTR 1y1y is down 6bps to 2.75%, with Brent crude futures down 7% and front-month TTF down over 8.5%. It comes after the US and Iran refrained from fresh strikes over the weekend.
- Markets will remain sensitive to headline flow though. Despite signs of de-escalation around the Strait of Hormuz, the Houthis have claimed attacks on two Saudi Aramco facilities.
- ECB-dated OIS price 22bps of hikes through September, 41.5bps through December and 57.5bps through the middle of next year. Last week’s ECB press conference implicitly endorsed market pricing for a September hike. That suggests there could be a high bar to not moving the deposit rate up to 2.50%.
- There’s plenty of regional data due this week, including Q2 flash GDP and July flash inflation.
- Note that on Friday evening, US President Trump indicated on Truth Social that he would be launching a new S301 investigation into the EU, in response to the bloc’s fines on EU tech companies.
EQUITIES: EU Cash Opening Calls
Jul-27 06:57
Estox 50: +1.13%, Dax: +1.29%, CAC: +0.93%, FTSE +0.92%, SMI +0.72%.
EGB OPTIONS: Bobl Call Spread
Jul-27 06:48
OEU6 114.75/115.25cs, bought for 8 in 1.5k.
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