EU-RUSSIA: EU Set To Pass Workaround To Freeze Russian Assets Long-Term

Buxl ASWs and swap spreads are set to register fresh closing highs for the current widening cycle.

• Today’s widening comes even as the long end lags in outright bond trade (Buxl yields little changed, ~2bp off session highs).
• While broader fixed income demand was noted in the wake of Tuesday’s U.S. weekly ADP employment data, the extension of the widening move was already in play before that data crossed.
• Elsewhere, the German debt brake proposal from the Bundesbank was a probably a secondary factor in late Tuesday/early Wednesday trade, with the bulk of Tuesday’s move taking place before those headlines crossed.
• Indeed, Commerzbank argue that “while it would fit the picture of long-term fiscal restraint, yesterday's noticeable 30-Year Bund swap spread richening was probably not directly triggered by the Bundesbank proposal. Speculation about looming Dutch paying flows in swaps could be behind it. While we see scope for more ultra-long Bund ASW richening in Q1, amid increased paying interest from Dutch pension fonds, the risk is that long UB positions are already a consensus trade”.

• MNI: CANADIAN SEP BUILDING PERMITS +4.5% MOM
• CANADA RESIDENTIAL BUILDING PERMITS +4.8% MOM; NON-RESIDENTIAL +4.0% MOM

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• At 19:30 ET 00:30 GMT, President Donald Trump will host a White House dinner for finance leaders, including the chief executives of Nasdaq and JPMorgan Chase. White House Press Secretary Karoline Leavitt will brief at 13:00 ET 18:00 GMT.
• Secretary of State Marco Rubio will participate in G7 sessions in Canada on Ukraine and maritime security. A meeting with Canadian Foreign Minister Anita Anand will offer an opportunity to reset trade talks.
• The longest government shutdown in US history appears set to end tonight. The House of Representatives will gavel in at 16:00 ET 19:00 GMT to begin voting on the Senate's CR/minibus package. A final vote is expected at around 19:00 ET 00:00 GMT.
• The White House appears to be taking steps to dial down tensions with key trading partners. Trump’s tariffs may be weakening a key security alliance in the Indo-Pacific.
• The White House took another step towards shuttering the Consumer Financial Protection Bureau.
• Washington and Riyadh are finalising agreements ahead of Crown Prince Mohammad bin Salman's visit next week.
• Russia's Foreign Ministry said Moscow is ready to resume talks with Ukraine.
• The most advanced US carrier fleet arrived in Southern Command yesterday. Trump's end goal in Venezuela remains unclear, but experts say the buildup of military assets in the southern Caribbean is inconsistent with small-scale strikes on alleged drug boats.
• Poll of the Day: Nearly half of Democrats disapprove of the government shutdown deal. 

Full Article: US DAILY BRIEF