EU-RUSSIA: Envoys Agree On Sanctions Rollover, But Hungary Gets Way w/3 Removed
Mar-14 09:35
Reuters reports that EU ambassadors have reached a unanimous agreement on rolling over sanctions on over 2,400 Russian individuals and entities. It also comes with the news that three individuals have been removed from the sanctions list.
- As previously noted (see 'EU-RUSSIA: Sanctions Rollover Meeting Pushed To Friday', 1529GMT 13 March), Hungary made the removal of eight individuals from the blacklist a condition of its approval for the sanctions rollover.
- Rikard Jozwiak at RFE/RL posts on X that "[Businessman Moshe] Kantor, [sister of Uzbek-Russian billionaire Alisher Usmanov, Gulbakhor] Ismailova, [Russia's Minister of Sport] Mikhail Degtyaryov and [former EuroChem Group CEO Vladimir] Rashevsky" are the individuals removed from the list.
- This is the second time in as many weeks that the Hungarian gov't has held up EU efforts to maintain a hardline stance on Russia. At the 6 March special European Council meeting, Hungary refused to sign off on the leaders' statement at the end of the summit due to opposition to language regarding EU commitments to provide "regular and predictable financial support" to Ukraine.
- The upcoming 20-21 March EUCO summit could provide another opportunity for disagreement, with Hungarian PM Viktor Orban pushing for a more conciliatory stance towards Russia amid prospective ceasefire talks.
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GBP: Negative Markets Bias May Provide Asymmetric Risks Around UK Data Ahead
Feb-12 09:35
GBP/USD's strong rally off yesterday's lows means the pair has now retraced over 50% of the post-BoE decision losses, putting the price within 100 pips of last week's highs.
- This signals that markets are taking Mann's views at face value this week - and that her vote for 50bps last week isn't the beginning of series of votes for aggressive easing given her preference for restrictive policy (we gauge bank rate as being ~100bps above her top estimate of neutral, therefore leaving little room for sizeable cuts).
- More broadly, the negative bias toward GBP/USD persists. Our CFTC positioning dashboard has GBP's 52w Z-score at -1.52, signalling positioning momentum is the second most-negative in G10 after NZD. This is reflected in the bias toward downside protection in GBP/USD this year: the shift lower for 3m risk reversals in January has largely stuck, mirrored in demand for OTM puts - we've tracked near $3bln cumulative notional traded across 1.22 puts in the past month, again cementing the market's concern over GBP downside risks.
- It's these factors that may provide asymmetric upside risks to GBP on strong data releases ahead - particularly data covering consumption, a driver of the weak demand that helped trigger Mann's vote for 50bps last week. Prelim Q4 GDP data crosses tomorrow morning.
EQUITIES: EU Bank Vol trade
Feb-12 09:34
SX7E (17th Apr) 170^, sold at 11.10 in 6k.
EQUITIES: Estoxx call spread
Feb-12 09:33
SX5E (21st Mar) 5550/5700cs, bought for 28.2 in 12k.
