US DATA: GDP Q4 Growth Trimmed Further, PDFP Still Tells A Stronger Story

A UK gov't spox says that PM Sir Keir Starmer spoke to the leaders of Germany and Italy on 9 March, with all three agreeing to "work closely together on freedom of navigation through the Strait of Hormuz in the face of Iranian threats". Adds that the UK is "working with allies on a range of options to support commercial shipping through the Strait as the picture develops."

• There have been questions asked domestically, in Europe, and in the US regarding the UK's response to the conflict. After placing the aircraft carrier HMS Prince of Wales on high alert for deployment to the Middle East, reports emerged late on 9 March that Downing St. said there was "no decision to deploy her".
• Despite its deployment being announced last week, the Type-45 destroyer HMS Dragon remains in Portsmouth. The gov't announced the ship would be deployed as part of defensive efforts around Cyprus, which has come under attack from drones launched by Iran/its proxies due to the presence of UK RAF bases. Cypriot high commissioner to the UK, Kyriacos Kouros, said the country was “disappointed” that there was a lack of warning to residents about incoming drone strikes.
• French President Emmanuel Macron, speaking from Cyprus on Monday, said that French vessels could perform a 'purely defensive' mission in escorting vessels through the Strait of Hormuz. It remains to be seen how the UK can join in with such an operation, given its lack of naval capaity in the region. 

Core global FI markets edged lower over the last hour or so on the back of news surrounding multi-tranche US$ & EUR issuance from Amazon (reportedly targeting $25-30bln & EUR10bln) and an uptick in oil (strikes on a UAE refinery and hardline comments from U.S. Defence Secretary Hegseth noted). Space has since stabilised.

• Geopolitical tensions remain off yesterday’s extremes after President Trump held a press conference where he suggested the U.S. military is ahead of schedule and that the war in Iran could soon be over (albeit not this week).
• Core global FI curves have steepened since that news flow crossed, with hawkish moves in front ends unwinding a little. EUR front end shows 24bp of ECB hikes through year-end, GBP has reverted to pricing BoE cuts (10bp of easing priced) and US$ shows 41.5bp of Fed easing through year-end.

Swedish Investment Fund Association flow data for February pointed to another month of net US equity fund selling and net domestic fund buying. This provides additional evidence of potential repatriation dynamics, though it will be interesting to see if the trend persists in March given the substantial geopolitical escalation. These flows did not lend SEK much support against the USD for February overall though, with Israeli/US strikes against Iran late in the month prompting haven flows into the dollar at the expense of the risk sensitive krona. 

• In February, Swedish members net bought SEK13.1bln of domestic equity funds, after SEK8.0bln in January and SEK6.2bln in December. These three months followed eight consecutive months of net sales.
• Meanwhile, members reported a fourteenth consecutive month of net US fund selling, with SEK8.2bln of net sales in February after SEK8.4bln in January and SEK9.8bln in December.
• That saw the net US vs Sweden outflow widen to SEK21.3bln, the largest since March 2025.
• European and global equity funds saw smaller relative flows in February.