EM CEEMEA CREDIT: Emirate of Abu Dhabi: Guidance
Sep-25 17:19
(ADGB; AA2/AA/AA)
Guidance: 3Y at T+10bp, 10Y at T+18bp
Size: USD1bn 3Y, USD2bn 10Y
IPTs: 3Y @ T+40bp & 10Y @ T+55bp
FVs: 3Y @ T+10bp & T+15bp
Source: BBG
Link to earlier note:
https://mni.marketnews.com/4267kAc
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STIR: Trump-Cook Back And Forth Continues To Set The Tone For Fed Rates
Aug-26 17:13
- Fed Funds implied rates are up to 3bp lower out to March meetings, sitting at the low end of the day’s range as they continue to be weighed by Trump yesterday saying he had removed Fed Governor Cook with immediate effect, who has since pushed back.
- Cumulative cuts from 4.33% effective: 21.5bp Sep, 34.5bp Oct, 54.5bp Dec, 68bp Jan and 82.5bp Mar.
- The ~55bp of cuts to year-end compares with almost 58bp seen after Powell on Friday vs 48-49bp prior.
- SOFR implied yields are up to 6.5bp lower on the day (SFRU6) having mostly gained through the US docket and with a strong 2Y auction helping maintain a bid seen in rates space.
- The terminal yield is 6bp lower at 2.985% (SFRH7) at what would push through Friday’s post-Powell close of 3.00% for the lowest since April.
- Cook yesterday pushed back on Trump’s firing, saying he has no authority to fire her and she won’t quit, whilst her lawyer has confirmed they will file a lawsuit challenging the firing.
- Cook yesterday: “President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so. I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022.”
- Ex Fed Governor Brainard earlier on Bloomberg TV warned that successfully taking out Cook would give Trump the chance of gaining a majority of his picks on the seven-member Board of Governors. The board is scheduled in February 2026 to vote on renewed terms for the 12 district bank chiefs — five of whom each year vote on interest rates.
- We expect further developments here to continue to have an impact, especially with no major data releases or Fed appearances scheduled for tomorrow before data picks up Thu/Fri.
US TSYS/SUPPLY: Review 2Y Note Auction: Strong
Aug-26 17:04
- Tsy futures inch higher after the latest $69B 2Y note auction (91282CNV9) stops through: 3.641% high yield vs. 3.656% WI; 2.69x bid-to-cover vs. 2.62x prior.
- Peripheral stats: Indirect take-up inches up to 57.09% from 55.33 prior, directs slip to 33.16% vs. 34.37% prior, primary dealer take-up at 9.74% vs. 10.30% prior.
- The next 2Y auction is tentatively scheduled for September 23.
FED: US TSY 2Y NOTE AUCTION: HIGH YLD 3.641%; ALLOTMENT 57.40%
Aug-26 17:02
- US TSY 2Y NOTE AUCTION: HIGH YLD 3.641%; ALLOTMENT 57.40%
- US TSY 2Y NOTE AUCTION: DEALERS TAKE 9.74% OF COMPETITIVES
- US TSY 2Y NOTE AUCTION: DIRECTS TAKE 33.16% OF COMPETITIVES
- US TSY 2Y NOTE AUCTION: INDIRECTS TAKE 57.09% OF COMPETITIVES
- US TSY 2Y AUCTION: BID/CVR 2.69
