POLAND: Governor Glapiński Flags Room For Further Cuts
Oct-10 07:31
- Governor Adam Glapiński left the door ajar to further rate cuts, guiding that if favourable trends continue, then the MPC could keep cutting rates in cautious 25bp increments. In the Governor's view, it could bring the reference rate to 4% (from 4.5% reached after this week's 25bp cut) and then reconsider its stance. At the same time, he pointed to a familiar list of risks, stressing that 'exceptionally loose' fiscal policy limits the room for monetary easing, while the possible introduction of the EU's ETS2 in 2027 looms large.
- Energy Minister Miłosz Motyka told Rzeczpospolita that the extension to electricity price freezing to 4Q25 was likely the last such measure amid an improving situation in energy markets. Motyka said that there are 'signals that suggest that [administered] energy prices in 2026 will be lower (..) than those resulting from the price freeze.' In its latest communique, the NBP flagged the expiry of price caps at the beginning of 2026 as a risk to the inflation outlook. Based on historical practice, the NBP's projection next month may assume that the tariffs will remain unchanged in 2026.
- Sejm Speaker Szymon Hołownia has been summoned to testify to Warsaw prosecutors over his complaint that he was approached and asked not to swear in President Karol Nawrocki in what would have amounted to a 'coup d'état'. Hołownia later said that he used the term 'not in a legal sense' but as a 'political diagnosis', criticising those calling for a recount of votes.
- Poland 2050's (P2050's) Katarzyna Pełczyńska-Nałęcz asked Prime Minister Donald Tusk for a meeting to discuss her nomination for the Deputy Prime Minister position. Tensions between coalition partners continue to simmer as P2050 demands compensation for the imminent rotation in the Sejm Speaker position stipulated by the coalition agreement.
- The NBP will publish the minutes of its September monetary policy meeting at 13:00BST/14:00CEST. Last month the Council voted to reduce the reference rate by 25bp.
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BUNDS: Futures Pierce Recent Highs
Sep-10 07:23
There was a technical element to the rally in Bund futures during the cross-asset vol. noted earlier, with the contract trading through the Sep 8 high (129.33), topping out at 129.44, just ahead of the Aug 5 high (129.50). A break above the latter would allow the recent bullish cycle to develop further.
- Contract eases back to 129.30 as cross-asset impetus subsides (detailed in recent bullet).
- German yields are 0.5-2.0bp lower, curve bull flattens.
EGB SYNDICATION: Luxembourg New 10-Year: Guidance
Sep-10 07:18
- EUR Benchmark of the new Sep-35 LGB (MNI pencil in a transaction size of E1.00-1.75bln)
- Guidance: MS+35bps area
- Issuer: GRAND DUCHY OF LUXEMBOURG (ticker: LGB)
- Ratings: Aaa/AAA/AAA (all stable)
- Format: RegS Bearer, Senior, Unsecured
- Coupon: Annual, ACT/ACT
- Size: EUR Benchmark
- Maturity: 17-September-2035
- Settlement: 17-September-2025 (T+5)
- ISIN: LU3182454440
- Bookrunners: BofA / BCEE / CACIB / DB / SG (B&D)
- Denoms: €1k+1k
- Target market: The target market for the Bonds is professionals, retail and eligible counterparties (all channels for distribution), each as defined in MIFID II/UK MiFIR.
- Timing: Books open, today's business
Per market source
CROSS ASSET: Move Fades
Sep-10 07:16
The knee-jerk USD bid fades from extremes as Euro Stoxx 50 futures recover back towards session highs after weakness around the cash equity open.
- Our best guess is that the USD bid stemmed from yield differentials moving in the USD’s favour on spillover from the weakness in European stocks.
- Volume was decent on the move, with ~38K Bund futures trading in a 10-minute window.
