EM CEEMEA CREDIT: Kazakhstan: Inflation

Core global FI markets consolidate off lows as NY participants settle in.

• Asia trade was shaped by digestion of the increased U.S. tariff threats against the EU & Mexico, as well as U.S.-Russia tension.
• A bid in crude oil (linked to the latter point above) and gilt outperformance in light of dovish comments from BoE Governor Bailey and a soft REC labour market release then came to the fore as the London morning wore on, driving gilt outperformance vs. peers across the curve.
• Meanwhile, Tsys lag German peers, while EGB spreads to Bunds are wider as equities hold lower on the day (albeit with major index futures recovering from worst levels).  

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• At 10:00 ET 15:00 BST, President Donald Trump will meet NATO Secretary General Mark Rutte at the White House. According to Trump’s diary, the meeting will be closed to the press. At some point today, Trump is expected to make a ‘major statement’ on Russia, likely to include new weapons shipments to Ukraine and the possible endorsement of sanctions on Russia.
• Trump concluded his tariff week with Saturday letters to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum, setting a 30% tariff rate for both trading partners.
• EU trade commissioner Maros Sefcovic said before a meeting of EU trade ministers this morning: "The feeling on our side was that we are very close to an agreement."
• Former President Joe Biden’s chief economic advisor, Jared Bernstein, wrote in an op-ed that he is, "joining the hawks", warning that Trump's Big Beautiful Bill is "a potential game changer for debt sustainability.”
• House Republicans will take up three major bills during their 'crypto week'.
• The Senate is expected to take up Trump’s USD$9.4 billion rescissions package.
• Trump’s Middle East Special Envoy Steve Witkoff said he is “hopeful”, when asked about the status of Gaza ceasefire talks.
• WSJ reports that Trump signalled he would support Israel in another attack, if Iran were to take steps towards making a nuclear bomb.
• Poll of the Day: 70% of independents oppose Trump's immigration policies.

Full Article: US DAILY BRIEF

• Treasuries trade mildly lower from Friday’s close, keeping to relatively narrow ranges for the session as they consolidate the sell-off seen Thu/Fri last week.
• President Trump has threatened 30% tariffs on EU and Mexico (its largest and second largest source of imports as of 2024 trade) ahead of an Aug 1 deadline. Talks will continue in the interim.
• Trump meets the NATO Secretary General Rutte at 1000ET and has also said a “major statement” on Russia is due.
• Cash yields are 0-1.5bp higher on the day.
• 30Y yields touched 4.9791% earlier (currently 4.965%) for highs since Jun 9 having last sustainably been above 5% in May.
• 5s30s of 99.1bps is elevated but remains below last month’s fresh ytd highs of 103.3bps.
• TYU5 is slightly higher at 110-26 (+03) as it roughly consolidates Friday’s decline to 110-22+, amidst slightly elevated cumulative volumes of 300k.
• Support at 110-21+ (Jul 8 low) and 110-17 (61.8% of May 22 – Jul 1 bull leg) holds for now, with declines undermining a previous bull theme.
• Data: None
• Fedspeak: None
• Bill issuance: US Tsy sell $82bn 13-W and $73bn 26-W bills (1130ET)