US: House GOP Tax Writers To Tout OBBB In Nevada Shortly
Jul-25 16:59
House Republicans from the Ways and Means Committee are shortly due to hold a full committee field hearing in Las Vegas, Nevada, to tout the GOP’s 'One Big Beautiful Bill'. The event is expected to focus on the ‘no tax on tips’ portion of the bill – an idea first proposed by Trump in Nevada to target service and hospitality workers. LIVESTREAM
- Ways and Means Committee Chair Jason Smith (R-MO) said: “We’re back and we’re at the birthplace of no tax on tips. This is where the president got the idea from his waitress at the Trump Hotel.”
- Punchbowl News notes that the more populist ideas that Trump pitched on the campaign trail are new, “which means Americans will actually feel the difference when they go into effect.”
- Smith said: “Americans won’t know what’s in it until they feel it for the most part, and so the polling that’s out right now, I don’t buy it. The American people whenever they experience the tax relief that they’re going to see when they file their taxes — the real tax relief they’re going to see — I think that November will be a much better day for House Republicans.”
- Punchbowl adds: “It’s a boost that Smith is counting on. So far, the OBBB’s polling has been underwater. Democrats are messaging aggressively against the bill and hammering cuts to Medicaid, SNAP and clean energy.”
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OPTIONS: Dovish Euribor Skew Persists, With Sonia Activity Picking Up
Jun-25 16:52
Wednesday's Europe rates/bond options flow included:
- ERQ5 98.1875/98.3125/98.4375 call fly 8K sold down to 1
- ERZ5 98.25c vs 2RZ5 98.0625c, bought the front for -1 in 15k
- ERZ5 98.125/98.25/98.375c fly x2 with ERZ5 98.375/98.50/98.625c fly vs 0RV5 98.0625p x1, bought the Flies strip for -0.5 in 8k
- ERZ5 98.375/98.50/98.625 call fly paper paid 1.5 on 5K.
- ERH6 98.125/98.25/98.50/98.625 c condor vs 97.9375p, bought for 1 in 5k
- SFIU5 95.90/96.00/96.15/96.25c condor, sold at 6.25 in 10.5k
- SFIU5 96.20/96.40 1x2 call spread paper paid 1.25 on 3K
- SFIX5 96.60/96.70cs, bought for 1.5 in 8k
- SFIZ5 96.10/96.25/96.40/96.55c condor, bought for 6 up to 6.25 in 30k
FOREX: EURJPY Resumes Strengthening Trend, Consolidating Sharp June Rally
Jun-25 16:51
- Despite yesterday’s pullback, EURJPY has recovered strongly on Wednesday, rising 0.55% and back above 169.00. The rally from the June lows totals ~4%, with Monday’s cycle highs immediately coming back into focus at 169.71.
- Price action continues to erode the steep declines seen in July last year, brought on by two bouts of currency intervention and a BOJ rate hike. This bolsters the technically bullish theme, and scope is seen for a climb towards 170.47, a key Fibonacci retracement point. Yen weakness this week has likely been exacerbated by positioning dynamics, evidence of which was in the latest CFTC data showing asset managers maintained their already extensive JPY longs.
- Hawkish signals from the BOJ will continue to be monitored to counter this short-term narrative. Indeed, board member Naoki Tamura signalled a more hawkish stance on Wednesday, suggesting the Bank’s 2% inflation target could be achieved earlier than expected and calling for a steady normalisation of monetary policy and the BOJ’s balance sheet.
- Significant events on the calendar this week include US GDP (3rd read) & May PCE, as well as Friday’s release of June Tokyo CPI.
US TSYS/SUPPLY: 5Y WI
Jun-25 16:47
The 5Y WI slips up to 3.872% from 3.877% earlier, 19.9bp rich to last month's stop: 4.071% high yield vs. 4.075% WI.
