RUSSIA: Kremlin Again Refuses To Say If Putin Will Attend Ukraine Peace Talks
Wires carrying comments from Kremlin spox Dmitry Peskov. Says that the Kremlin will disclose the make-up of the Russian delegation to Istanbul for Ukraine peace talks on Thursday (15 May) when President Vladimir Putin gives the order. This stands in contrast to comments from an unnamed senior Russian lawmaker on Telegram, claiming that the identity of the delegation will be known this evening, and that an 'all-for-all' prisoner exchange could be discussed.
- Peskov claims that Putin's offer of direct talks on Thursday stands. Says "the Russian delegation will be in Istanbul on Thursday and wait for the Ukrainian delegation.
- There remains absolute uncertainty as to whether Putin will attend the talks in person. Not attending risks a backlash from the US, with senior figures including President Donald Trump becoming increasingly tetchy at what they have said is foot-dragging by Moscow.
- Earlier, Brazilian President Luiz Inacio Lula da Silva said that on his way back from a state visit to China, he will stop over in Russia to try and push for negotiations. Lula: “I’ll try to talk to Putin. It costs me nothing to say, ‘hey, comrade Putin, go to Istanbul and negotiate, dammit’”
- On other issues, Peskov says that Putin has an invitation to visit Iran, but that there is no date for the trip agreed yet. On reports that French President Emmanuel Macron is open to deploying nuclear-armed planes across Europe, Peskov says 'proliferation of nuclear arms would not enhance Europe's security.'
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GERMAN T-BILL AUCTION RESULTS: 12-month bubills
| Type | 12-month Bubill |
| Maturity | Apr 15, 2026 |
| Allotted | E2.4945bln |
| Previous | E1.625bln |
| Total sold | E3bln |
| Target | E3bln |
| Avg yield | 1.864% |
| Previous | 2.133% |
| Bid-to-cover | 2.58x |
| Previous | 1.87x |
| Bid-to-offer | 2.14x |
| Previous | 1.01x |
| Previous date | Mar 17, 2025 |
BONDS: Gilts Unwind A Portion Of Last Week's Selloff, Outperforming Bunds
The 10-year Gilt/Bund spread has tightened 5bps to 213bps, with UK paper staging a light relief rally alongside USTs this morning. Market moving headline flow has been relatively limited, with participants assessing weekend rhetoric from US officials on consumer electronics tariffs alongside the highly volatile nature of last week’s moves.
- Gilt yields are 3.5-9.5bps lower across the curve, bull flattening. 2s30s has fallen 6bps to ~141bps, unwinding last week’s notable steepening.
- German yields are flat to 3bps lower, with the belly outperforming.
- Futures volumes are comfortably below recent averages. Bunds are -14 ticks at 130.84 (Initial resistance at the Apr 11 high of 131.42; Support at the 20-day EMA of 129.59). Gilts are +66 at 91.30 (Initial resistance at the 20-day EMA of 91.84; Support at Apr 11 low of 90.47).
- Strength in US equity futures has fed well into outperformance for cash European indices this morning. The reprieve for electronics imports from China into the US is the driver here. That helps 10-year EGB spreads to Bunds tighten.
- BTPs outperform, also aided by S&P’s upgrade of Italy's sovereign rating to BBB+ (Outlook Stable) after hours on Friday.
- This week’s regional calendar is headlined by UK labour market (Tues) and inflation (Weds) data and the ECB decision (Thurs).
EQUITIES: Estoxx put Spread
SX7E (17th Apr) 170/165ps, bought for 1.35 in 6k vs ~1.1k at 167.00.
