BOND SUMMARY: EGB/Gilt: Mixed Trading
Apr-28 10:52
European government bonds have traded mixed this morning while equities have pushed higher and the US dollar has posted broad gains against G10 FX.
- Gilts have traded weaker this morning with yields up 1-3bp.
- The bund curve has slightly bear flattened with the 2s30s spread narrowing 2bp.
- The OAT curve has marginally twist flattened with the 2s30s spreading trading down 1bp.
- BTPs have lacked clear direction while trading broadly firmer on the day.
- The ECB's Ignazio Visco has stated that a rate adjustment could come in Q3 or by end-year.
- German regional CPI data for April has been mixed with some states reporting an acceleration from the previous month and others a deceleration. The national estimate will be published at 1300GMT.
- Elsewhere, the preliminary April estimate for Spanish inflation came in below expectations (8.3% Y/Y vs 9.0% expected).
- Focus shifts to the first estimate of US Q1 GDP later today.
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CANADA: Outlook: Emissions Reduction Plan, Bill Issuance
Mar-29 10:40
- SEPH payroll report for Jan -- largely overlooked by the main payroll report for Mar on Apr 8, the last major input before the BoC decision on Apr 13.
- Bill issuance for 98-d (C$6.45B), 182-d (C$2.4B) and 364-d (C$2.4B).
- Environment Minister Guilbeault tables a new GHG emissions plan in the morning, as part of the goal to reduce emissions by 40-45% below 2005 levels by 2030. CTV notes that Canada has issued at least 11 plans and set 9 different emissions targets since 1988 but has yet to meet one.
- Yesterday, Trudeau secured an ambitious but expensive legacy project as Ontario signed onto a federal child-care program after nearly a year of negotiations. It joins a five-year C$30B program [1.2% of 2021 GDP] first announced in the 2021 budget. (Bloomberg)
STIR FUTURES: Back To A Further 8.5+ Fed Hikes This Year
Mar-29 10:36
- Fed hike expectations by Dec’22 have ground higher through both Asian and European sessions with 215bp now priced in FOMC-dated Fed Funds, up from an earlier ‘low’ of 207bps but still off yesterday’s highs of 220bps.
- As with yesterday, there has been less change for immediate meetings, with May nudging up to 45.5bps but June little changed at highs of 88bps (18% chance of 75bps, 61.5% of 100bps, 20.5% of 125bps).
- Fedspeak is kicked off by NY Fed’s Williams at 0900ET but only with opening and closing remarks at a conference on banking culture, after non-committal comments around the prospects for a 50bp hike last week.
- Philly Fed’s Harker (2023 voter) provides his first post-FOMC thoughts on the economic outlook at 1045ET, followed by a CNBC interview at 1440ET.
FOMC-dated Fed Funds cumulative hikes by meetingSource: Bloomberg
OAT: Block trade
Mar-29 10:35
OAT block seller
- OATM2 1.5k at 149.82
