EUROPEAN INFLATION: German HICP / national CPI both 0.1ppt higher than expected

• In addition to providing the new auction sizes for the upcoming quarter, we will answer this question upon release of the Treasury Quarterly Refunding Statement (with color on changes if any): Is the guidance on coupon issuance unchanged? “Treasury anticipates maintaining nominal coupon and FRN auction sizes for at least the next several quarters.”
• Additionally we include the following questions on buybacks:
  • Total maximum purchase amount of buybacks in the 20Y-30Y range (B USD)
  • Total maximum purchase amount of buybacks in the 10Y-20Y range (B USD) 

• Overnight Rate Target (%)
• Does the Bank signal it's prepared to LOWER rates in the future?
• Does the Bank reiterate it could LOWER rates if the economy weakens amid tariffs and inflation is contained?
• Does the Bank signal it is prepared to RAISE rates in the future?
• Does the Bank signal it intends to leave rates ON HOLD?

Federal Reserve (1400ET): 

• Federal Funds Rate Range Maximum
• Number of dissenters       
• Number of dissenters preferring a rate cut 
• Number of dissenters preferring a 50bp cut

Bund futures fade from recovery highs, leaving the range established in early London hours intact.

• A relief rally came on the lack of meaningful upside spending surprise in the German fiscal update, although the lack of truly new news meant that the rally was quickly halved as the initial impetus faded, with some recent selling pressure in Tsys also factoring in.
• Bund futures last little changed at 129.63, German yields flat to 1.5bp lower, 10s outperform on the curve.
• EGB spreads to Bunds are little changed to 1.5bp wider on the day, with little in the way of meaningful European headline flow to note outside of this morning’s data and German fiscal matters.

Reuters reports comments from Finance Minister Lars Klingbeil regarding the US-EU trade deal announced over the weekend. The minister says, "I am not happy with the deal...It will take a toll on the economy." Chancellor Friedrich Merz initially appeared satisfied with the deal. He said it meant that "We have been able to safeguard our core interests. Stable and predictable trade relationships with market access benefit everyone, on both sides of the Atlantic, companies and consumers alike." However, by 28 July, Merz said that the tariffs would place a "considerable burden" on the German economy. 

• Bavaria's Minister-President and leader of the Christian Social Union, the sister party to Merz's centre-right Christian Democratic Union, Markus Soeder, said on 28 July that "The customs deal has prevented the worst, but the situation is now more difficult than before, especially for the automotive industry. That's why it must be clear: There must be no additional taxes in Europe, as the EU is currently planning."
• While German politicians may be decrying the deal to domestic audiences, the prospect of the agreement being shot down by Berlin is slim. Firstly, the Commission could look to streamline the process of approval to the point it does not go through the member state ratification process at this time. Secondly, much of the criticism has come about the fact that Germany (and the wider EU) are facing US tariffs at all, rather than arguing the deal should be rejected.