ECB: Macro Developments and GC Signals All But Confirm September Hold
Aug-22 11:02
This week's signals from flash PMI data, President Lagarde's speech and the latest Bloomberg sources...
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EU: EU Plans 30% Tariffs On E100bn Of Goods To US If No US Deal - Bloomberg
Jul-23 11:02
- Bloomberg reports that "The European Union plans to quickly hit the US with 30% tariffs on some €100 billion ($117 billion) worth of goods in the event of no deal and if US President Donald Trump carries through with his threat to impose that rate on most of the bloc’s exports after Aug. 1.
- As a part of a first wave of countermeasures, the EU would combine an already approved list of tariffs on €21 billion of US goods and a previously proposed list on an additional €72 billion of American products into one package, an European Commission spokesman said on Wednesday."
- The broad piece chimes with our policy team exclusive from last week (see "MNI: Support Grows For Retaliation Against US - EU Officials" - Jul 17).
- However, the following would be a notable firming in Germany stance. "Berlin would be willing to even support the activation of the EU’s anti-coercion instrument, or ACI, in a no-deal scenario, a government official said on condition of anonymity. This tool would come into play only if a deal fails to materialize."
- From our policy piece last week: "There is also the prospect of enacting the EU’s Anti-Coercion Instrument, which would apply charges to a wide range of U.S. services, though concerns over whether this would do excessive harm to Europe’s economy mean there is widespread reluctance to see it deployed."
MNI: US MBA: MARKET COMPOSITE +0.8% SA THRU JUL 18 WK
Jul-23 11:00
- MNI: US MBA: MARKET COMPOSITE +0.8% SA THRU JUL 18 WK
US TSYS: Losses Pared, 20Y Auction Watched After Steepening
Jul-23 10:44
- Treasuries are off lows although maintain a modest sell-off that has been aided by broader equity strength in Japan following a US-Japan trade deal with 15% tariffs rather than the 25% threatened. Japan PM Ishiba denied media reports that he is set to announce his resignation soon.
- A poorly received JGB auction also helps the steepening bias seen.
- Trade talks: Building on comments from Bessent yesterday, the China Ministry of Commerce says China-US will hold trade talks in Sweden Jul 27-30. Separately, EU’s Sefcovic is to talk to US Commerce Secretary Lutnick this afternoon.
- Today sees existing home sales and 20Y supplybefore Leavitt and then Trump remarks.
- Cash yields are 1-2bp higher with increases led by 10-30Y tenors.
- 2s10s at 52.6bp (+1.1bp), 5s30s at 104.1bp (+0.6bp). 5s30s peaked at 108.5bp last week after Trump-Powell firing headlines.
- TYU5 has lifted a few ticks over the past hour to 111-06+ (-06+) on modest cumulative volumes of 285k.
- It has eased to sit more firmly into yesterday’s range away from the high of 111-14+ which cleared resistance at 111-13+ (Jul 10 high). A clear break of this hurdle would highlight a stronger reversal and open 111-28 (Jul 3 high).
- Data: MBA mortgage applications (0700ET), Existing home sales Jun (1000ET)
- Coupon issuance: US Tsy $13B 20Y Bond re-open (1130ET). Last month’s 20Y was mixed, drawing a small 0.2bp tail, a higher bid-to-cover and lower indirect take-up.
- Bill issuance: US Tsy $65B 17W bills (1300ET)
- Politics: White House Press Secretary Leavitt (1300ET), Trump remarks at Executive Orders at AI Summit (1700ET)
