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• Fed Funds implied rates continue to hold towards their more hawkish levels in recent months for 2025 meetings with a next cut eyed for October.
• Cumulative cuts from 4.33% effective: 1bp for tomorrow, 17bp Sep, 28bp Oct, 44bp Dec, 52.5bp Jan and 64bp Mar.
• The SOFR implied terminal yield of 3.235% (SFRH7) is just 0.5bp lower on the day and within a 3.1-3.3% range seen through July.
• Today sees a range of data releases starting with international trade/inventories data for June (useful for latest Q2 estimates ahead of Thursday’s advance release) before JOLTS and the Conference Board consumer survey.
• The calendar then accelerates in importance with the FOMC decision on Wed before GDP/PCE/NFPs on Thu & Fri. The MNI Fed Preview incl. analyst outlooks: https://media.marketnews.com/Fed_Prev_Jul2025_With_Analysts_002622ac0e.pdf

• RES 4: 112-15   61.8% retracement of the Apr 7 - 11 sell-off
• RES 3: 112-12+ High Jul 1 and a bull trigger
• RES 2: 111-28   High Jul 3 
• RES 1: 111-14+ High Jul 22 
• PRICE:‌‌ 110-27+ @ 11:21 BST Jul 29
• SUP 1: 110-19+/08+ Low Jul 24 / Low Jul 14 & 16        
• SUP 2: 110-03   76.4% retracement of the May 22 - Jul 1 bull leg
• SUP 3: 109-28   Low Jun 6 and 11
• SUP 4: 109.25   Low May 27

Treasury futures are unchanged and remain above last week’s low. Recent gains resulted in a break of the 20-day EMA, strengthening the recovery. Note too that resistance at 111-13+, Jul 10 high, has been pierced. A clear break of it would highlight a stronger reversal and open 111-28, the Jul 3 high. Key support is 110-08+, the Jul 14 and 16 low. Clearance of this level would reinstate a bearish theme. First support is at 110-19+, the Jul 24 low.

BTP/Bund spread falls below 80bps, Eyeing next support:

• As pointed out last Month and Yesterday, looking at that longer term chart, aside from the April 2010 low situated at ~75.4bps, the next big support resides at 65.37bps, the 2009 low.