US: House Conservatives Escalate Calls For Deeper Medicaid Reform

Two-way call spd interest and put structure selling since the open. Underlying futures climbing off lows, Whites lagging; projected rate hike pricing mixed vs. this morning's levels (*) as follows: May'25 at -4.4bp (-5bp), Jun'25 at -20.7bp (-20.2bp), Jul'25 at -38.9bp (-38.4bp), Sep'25 -57.4bp (-56.7bp).

• Block, +5,000 SFRM5 96.12/96.37 call spds, 3.25 ref 95.93
• -5,000 0QU5 96.62 puts, 29.0 vs 96.74/0.42%
• -5,000 3QU5 95.00 puts, 4.0 vs. 96.31/.06%
• +5,000 0QM5 95.25/3QM 95.12 put spds, 1.5 net/3QM over
• -10,000 SFRN5 96.25 calls, 24-23.5 ref 96.27
• +40,000 SFRZ5 98.00/99.00 call spds 5.0 vs. 96.52 to -.50/0.05%

Ukrainian President Volodymyr Zelenskyy has confirmed that representatives from Ukraine, the UK, France, and Turkey are holding a meeting on Black Sea security today, per Reuters. Zelenskyy also noted that talks today with US officials on a minerals agreement were "positive", adding that more meetings were expected throughout the week.

• NATO SecGen Mark Rutte said after a meeting with Zelenskyy: "We will continue to help Ukraine so it can defend today and deter future aggression, ensuring a just and lasting peace".
• The meetings come amid signs that the Trump administration may be losing patience in Russia's approach to the ceasefire process. President Donald Trump reiterated to reporters yesterday that Zelenskyy and former US President Joe Biden are responsible for allowing the war to happen but included Russian President Vladimir Putin on the list: “Biden could have stopped it, and Zelenskyy could have stopped it, and Putin should have never started it. Everybody’s to blame.”
• Trump's envoy Steve Witkoff said US-Russia talks could be on the "verge of something that would be very, very important for the world at large", but a breakthrough appears dependent on Russia’s greenlighting a truce or the US pivoting to more pressure on Moscow.
• Russian Foreign Minister Sergei Lavrov told Kommersant today: "It is not easy to agree the key components of a settlement... We are well aware of what a mutually beneficial deal looks like, which we have never rejected, and what a deal looks like that could lead us into another trap,"

Bloomberg reports that the EU expects US 'reciprocal' tariffs to remain in place as talks between the two sides have made little progress. Christophe Barraud at BBG writes there has been little sign of the US and EU "bridging trade differences, with US officials indicating that most US tariffs on the EU will not be removed." 

• Barraud: "The EU has offered to remove all tariffs on industrial goods, including cars, but the US has rejected the proposal, and instead suggested that some tariffs could be offset by increasing investments and exports."
• This comes a day after EU Trade Commissioner Maros Sefcovic met with US Commerce Sec Howard Lutnick and USTR Jamieson Greer in Washington. EU spox called the meeting a "scoping exercise, exploring areas of a potential deal in order to organise our further engagement in a structured way and to focus our minds on possible mutually beneficial solutions within particular areas."
• BBG report Sefcovic "left the meeting with little clarity on the US stance, struggling to determine the American side’s aims, according to people familiar with the discussions."
• The EU confirmed on 14 April that it was pausing countermeasures against the US to allow for further talks. These were due to come in on 15 April, and were focused on retaliating against the steel and aluminium tariffs imposed by the Trump admin in March.