RATINGS: Four Sovereign Ratings Up For Review On Friday
Oct-07 14:32
Potential sovereign rating reviews of note scheduled for after hours on Friday include:
- Fitch on Austria (current rating: AA+; Outlook Stable) and Greece (current rating: BB; Outlook Positive)
- DBRS Morningstar on Cyprus (current rating: BBB; Stable Trend) and The Netherlands (current rating: AAA; Stable Trend)
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
BONDS: EGB/Gilt - Unwinding shorts
Sep-07 14:31
- Another volatile session for EGBs and Bund, with most contract retracing, unwinding some of yesterday's sell off, but we are still short of yesterday's highs.
- Some desks have likely favoured squaring some shorts, with all the attention turning to the ECB tomorrow.
- Out of Bloomberg's surveyed firm, 2 are going for 25bps hike, 17 for 50bps, and 26 for 75bps.
- Volume are still dominated by rolling positions into December, and the majority is now all but done, ahead of expiry tomorrow.
- Gilt trades in line with Bund, albeit 1bps tighter at the time of typing.
- Gilt has also been underpinned, after BoE speaker leaned on the dovish side during the Parliament's Treasury Committee.
- Looking ahead, ALL EYES will be on the ECB tomorrow.
CANADA: Front Bax Yields Firm With BoC, Less So Further Out
Sep-07 14:27
- The BoC hiked 75bps to 3.25% as widely expected, whilst kept the need to hike further with the risk of elevated inflation becoming entrenched and the economy continuing to operate in excess demand.
- BAX front yields have seen a solid increase on the back of it, with BAZ2 +7bps on the day having pulled back from fleetingly touching a new high for the cycle.
- The whole curve has shifted up but moves are kept to +2-3bps through 2023 with little new in the statement to shape longer term rate expectations. Tomorrow’s Economic Progress Report could be more impactful here.
US: Republicans Could Be Dealt Severe Blow In Florida Midterm Races
Sep-07 14:24
Latest polling from the key swing state of Florida shows Republican incumbents in the races for the US Senate and governor's mansion holding slender leads over Democratic challengers. The elections outcomes could have a major impact on the US political landscape.
- Florida Senate: Rubio (R-Inc) 49%, Demings (D) 47% (Impact/Fabrizio Lee, 24-31 Aug); Rubio:(R-Inc): 47%, Demings (D): 44% (Susquehanna, 29 Aug-3 Sep)
- Florida Governor: DeSantis (R-inc) 50%. Crist (D) 47% (Impact/Fabrizio Lee, 24-31 Aug); DeSantis: 47%, Crist (D): 43% (Susquehanna, 29 Aug-3 Sep)
- Senator Marco Rubio (R-FL) is seeking a third term in office, and faces Congresswoman Val Demings (D-FL). Control of the Senate looks to be trending narrowly towards the Democrats, but many races are still on a knife-edge. Losing Rubio's Florida seat would almost certainly condemn the Republicans to the minority position in the Senate.
- There is significant focus on the governor's race due incumbent Ron DeSantis' prominent position in the national political discourse. DeSantis is the most prominent incumbent Republican politician in the US at present, and is second-favourite to become the next US president behind only Donald Trump (see chart below). Losing to former Republican governor, now a Democrat, Charlie Crist would deal a sizeable blow to his image as an election winner.
Chart 1. Betting Market Implied Probability of Next US President, %
Source: Smarkets
