CHILE: March Economic Activity Rises to 3.8% Y/y, Above Expectations

Similar to Tsys, ADP-related pullbacks in EGBs and gilts remain shallow, with worry ahead of the “Liberation Day” tariff announcements continuing to underpin.

• Bund futures just below session highs, with 10-Year yields just above the previously identified key support level.
• Meanwhile, gilt futures trade to fresh session highs but remain within yesterday’s range and below trendline resistance (92.42 today).

• Treasuries pare gains slightly after higher than expected ADP private jobs gains, prior up-revised as well. Tsy Jun'25 10Y contract trades 111-27.5 (+2.5) vs. earlier high of 111-29.5, next technical resistance at 112-01 (High Mar 4 and a bull trigger).
• Curves mixed, short end flattening off early week highs: 2s10s -.820 at 27.552, 5s30s +0.526 at 60.327.
• Cross asset update: stocks weaker (SPX eminis -49.0 at 5625.5).Bbg US$ index -1.17 at 1272.11.

SOFR option volumes picking up ahead of the NY open, chunky put spds and condors joining midcurve call spds. Implied vol rising ahead of this morning's ADP employ data and this afternoon's reciprocal tariff announcement. Projected rate cuts through mid-2025 have receded vs. late Tuesday levels (*) as follows: May'25 at -4.7bp (-5.3bp), Jun'25 at -21.2bp (-22.1bp), Jul'25 at -37.1bp (-39.1bp), Sep'25 -53.9bp (-56.6bp).

• SOFR Options:
  • Block/screen, 33,000 SFRU5 95.25/95.75 put spds, 2.5 ref 96.22
  • Block/screen, 29,000 0QM5 96.81/97.00 call spds, 5.0 ref 96.615
  • 26,000 0QU5 95.50 puts ref 96.635
  • 3,500 0QM5 97.50 calls ref 96.62
  • 2,000 SFRK5 95.62/95.75/95.81/95.87 broken put condors ref 95.93
  • 8,000 SFRM5 95.62/95.68/95.87/95.93 put condors ref 95.92
  • 13,700 SFRM5 95.68/95.75/95.81/95.87 put condors ref 95.92
  • 1,500 SFRM5 96.00/96.25/96.37 broken call flys ref 95.92
  • 2,000 SFRN5 96.12/96.25/96.37 call flys ref 96.205
  • 2,100 2QM5 96.56/96.81 call spds vs. 95.68/95.81 put spds ref 96.555
  • 6,000 0QM5 96.75/97.00 call spds ref 96.595 to -.59
  • +8,000 SFRM5 95.62/95.68/95.87/95.93 put condors, 3.5 vs. 95.895/0.05%
  • Block/screen +13,000 SFRM5 96.12/96.50 call spds 3.75 ref 95.92
• Treasury Options:
  • 1,600 TYM5 112/113 call spds ref 111-26.5
  • 1,100 FVK5 108.5/109/109.25/109.5 broken call condors
  • over 6,000 TYK5 111.5 calls, 55 ref 111-22.5
  • 1,350 TYM5 112/114 call spds vs. 110 puts ref 111-21.5
  • -10,000 TYK5 113.25 calls, 17 ref 111-25
  • over 3,300 TYK5 114.5 calls ref 111-21.5
  • -5,000 Wed wkly 10Y 111.75/112 put spds, 13 ref 111-16.5