EMISSIONS: France and Spain Back 2035 Diesel and Petrol Car Ban

Bloomberg Bonds projection:

• US Tsys: +0.06yr (small).
• EU Govies: +0.08yr (average).
• UK Govies: 0.00yr (non event).

Barclays FX:

• Their passive Month-End and Quarter-End rebalancing model shows moderate USD selling against all majors.

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Repeat send from yesterday.

• Markets and analysts see a hold at 0.00% at Thursday's meeting as most likely, with a cut into negative territory appearing improbable given inflation has remained within the SNB's defined range of price stability for three months now.
• US tariffs at 39% remain of some concern for the Swiss economy leading to downside pressure on GDP estimates but should not move the needle for near-term SNB policy.
• The rates outlook is likely to continue to be characterized by a high bar to further cuts into negative territory, a comment on that may or may not make it into the press statement but will anyways be discussed in the subsequent media conference.
• The SNB's FX communications paragraph is likely to remain materially unchanged given a limited move in the trade-weighted CHF since the June meeting.
• For the first time, additional colour on the governing board decision making process will be the provided four weeks after the meeting with the new meeting summaries.

• Treasuries are running steady to mixed, inside a narrow overnight range after 10s revisited last Thursday's closing levels. US$ climbing, Bbg index +4.48 at 1200.15 - early Monday levels.
• TYZ5 currently trades at 112-28 (+0.0) on cumulative volumes of 220k. 10Y yield +.0077 at 4.1138%.
• Moving average studies remain in a bull mode position, highlighting a dominant uptrend. The bull trigger has been defined at 113-29, the Sep 11 high. Otherwise, the pullback in Treasury futures appears corrective after TYZ5 moved through the 20-day EMA, at 112-28. The break signals scope for a deeper retracement and attention turns to the 50-day EMA, at 112.10 and the next key support.
• Lighter data on tap ahead a much busier Thursday: MBA Mortgage Applications (0700ET), New Home Sales (1000ET) along with Building Permits at some point today. Main focus is on Thursday's heavy data drop: Personal Consumption, GDP, Durables/Cap Goods, and weekly claims.
• Treasury supply: $28B 2Y FRN re-open (91282CNQ0) & $65B 17W bill auctions (1130ET), $70B 5Y Note Auction (91282CPA3) at 1300ET.
• Fedspeak: At 1610ET, SF Fed President Daly's economic outlook at the annual Spencer Fox Eccles Convocation at the University of Utah’s School of Business, moderated Q&A follows.
• Politics: President Trump's schedule is muted today after speaking at the at the United Nations yesterday, largely closed press items. Unscheduled social media posts always a potential market mover, however.