EXECUTIVE SUMMARY
US
MNI: FOMC Sticks To Two '25 Cuts, Slows QT Pace
Federal Reserve officials said Wednesday they expect to cut interest rates twice this year, the same as December, as inflation looks more persistent than thought and heightened uncertainty around tariff policies raises worries about an economic slowdown. The central bank also decided to slow the pace at which it is reducing Treasuries holdings in its balance sheet to a cap of USD5 billion per month from USD25 billion previously. Fed Governor Chris Waller dissented against that portion of the decision, preferring to maintain the current pace of asset runoffs. Agency mortgage securities will continue to run off at a maximum of USD35 billion a month.
MNI BRIEF: Powell Says Fed Can Wait For More Policy Clarity
Federal Reserve Chair Jerome Powell said Wednesday the central bank is well-positioned to sit tight and wait for policy uncertainty to subside before making any decisions on interest rates. "We are well positioned to wait for greater clarity," Powell told reporters during his press conference, citing two-sided risks to the outlook. "Some near-term measures of inflation expectations have recently moved up. We see this in both market and survey based measures and survey responses. Both consumers and businesses are mentioning tariffs as a driving factor," he said.
MNI BRIEF: Powell-QT Trim To Extend Approach To Ample Reserves
The Federal Reserve slowed the pace of Treasury runoffs from its balance sheet in order to gauge more gradually what might be considered an "ample" level of reserves in the banking system, Fed Chair Jerome Powell said Wednesday. "We came to the view that this was a good time to make the move that we made," he said. "We are going to cut it roughly in half. And the sense of that is, if you are cutting the pace of QT roughly in half, then the runway has probably doubled."
NEWS
MNI US: Trump's Dismissal Of Democrat FTC Commissioners Delivers More Uncertainty
President Donald Trump yesterday fired the two Democrat members of the Federal Trade Commission - Rebecca Slaughter and Alvaro Bedoya -, a surprise move considering the White House had hinted at some continuity from the Biden administration at the FTC.
MNI RUSSIA: Kremlin Blames Kyiv For Energy Infra Attacks Ahead Of US-Ukraine Call
State-run TASS carrying comments from Kremlin spox Dmitry Peskov regarding the call on 18 March between Presidents Vladimir Putin and Donald Trump. Says that the ceasefire order on Ukrainian energy infrastructure has not been cancelled "despite Kyiv's provocations" (reports suggest that both Ukraine and Russia attacked one another's energy infrastructure after the announcement). Peskov says that the truce only relates to energy, "not all infrastructure". Peskov claims that the Ukrainian attacks overnight "show Kyiv's lack of will to reach a deal", calling it "a cause for concern".
Reuters reporting comments from EU High Representative for Foreign Affairs and Security Policy Kaja Kallas, speaking on the phone call between Presidents Donald Trump and Vladimir Putin on 18 March. Kallas says that it is "clear that Russia does not really want to make any kind of concessions", and that "Russia can't be trusted." Claims that "what Russia wants is for Ukraine to let its guard down." Kallas says that southern Europe is part of the 'coalition of the willing' that will militarily help Ukraine. Following Putin's demand that all foreign aid to Kyiv stops, Kallas says that "Ukraine has to be able to defend itself".
MNI TURKEY: Imamoglu Arrest Risks Social Unrest Despite Ban On Protests
The arrest of Istanbul mayor and key opposition figure Ekrem Imamoglu on charges of being a "criminal organisation leader suspect" has roiled domestic and regional financial markets. As has been noted, Imamoglu is seen as the most significant political challenge to President Recep Tayyip Erdogan, with the Istanbul mayor due to have been confirmed as the presidential candidate for the main opposition centre-left Republican People's Party (CHP) on 23 March.
MNI ISRAEL: Foreign Minister Indicates IDF Ground Operations In Gaza Could Resume
Amichai Stein at Israel's i24 posts on X: "Reports: IDF armored forces are reoccupying areas they had previously abandoned along the Natzrim corridor.[...] Israeli Defense Minister Israel Katz, in a message to the residents of Gaza: The evacuation of civilians from the battle zones will soon begin again, and the situation will become much more difficult, with you bearing the full consequences. Katz added: Return the hostages and remove Hamas – the alternative is total destruction and devastation."
MNI US TSYS: Treasuries Rally Post FOMC, Underscores Policy Patience
MNI STIR: FOMC Announcement Trims Hawkish Repricing Seen Pre-Decision
OVERNIGHT DATA
MNI US DATA: Small Uptick In Mortgage Rates Sees Activity Moderate
MARKETS SNAPSHOT
Key market levels of markets in late NY trade:
DJIA up 383.32 points (0.92%) at 41964.63
S&P E-Mini Future up 65.5 points (1.16%) at 5734.75
Nasdaq up 246.7 points (1.4%) at 17750.79
US 10-Yr yield is down 4.2 bps at 4.2408%
US Jun 10-Yr futures are up 8.5/32 at 111-2
EURUSD down 0.0041 (-0.37%) at 1.0904
USDJPY down 0.62 (-0.42%) at 148.64
WTI Crude Oil (front-month) up $0.3 (0.45%) at $67.20
Gold is up $11.48 (0.38%) at $3046.19
European bourses closing levels:
EuroStoxx 50 up 22.35 points (0.41%) at 5507.36
FTSE 100 up 1.43 points (0.02%) at 8706.66
German DAX down 92.64 points (-0.4%) at 23288.06
French CAC 40 up 56.9 points (0.7%) at 8171.47
US TREASURY FUTURES CLOSE
3M10Y -5.469, -5.851 (L: -6.042 / H: 1.243)
2Y10Y +2.313, 26.224 (L: 21.391 / H: 27.755)
2Y30Y +3.092, 57.213 (L: 50.46 / H: 58.951)
5Y30Y +1.565, 52.561 (L: 47.752 / H: 54.043)
Current futures levels:
Jun 2-Yr futures up 3.875/32 at 103-15.75 (L: 103-08.625 / H: 103-16.25)
Jun 5-Yr futures up 6.5/32 at 107-29.75 (L: 107-15 / H: 107-31)
Jun 10-Yr futures up 8.5/32 at 111-2 (L: 110-14.5 / H: 111-03)
Jun 30-Yr futures up 14/32 at 117-22 (L: 116-22 / H: 117-23)
Jun Ultra futures up 16/32 at 123-13 (L: 122-06 / H: 123-14)
MNI US 10YR FUTURE TECHS: (M5) Support Remains Intact
The trend condition in Treasury futures is bullish and the recent pullback appears corrective. The bull cycle is reinforced by MA studies that are in a bull-mode condition. Recent gains have resulted in a print above 111-22+, the Dec 3 ‘24 high. A clear breach of this level would open 112-02 and 112-13, Fibonacci projections. Firm support is at 110-00, Feb 7 high. Support at the 20-day EMA, at 110-15+, has been pierced but remains intact.
SOFR FUTURES CLOSE
Mar 25 +0.005 at 95.688
Jun 25 +0.020 at 95.890
Sep 25 +0.045 at 96.125
Dec 25 +0.075 at 96.305
Red Pack (Mar 26-Dec 26) +0.075 to +0.085
Green Pack (Mar 27-Dec 27) +0.035 to +0.065
Blue Pack (Mar 28-Dec 28) +0.025 to +0.035
Gold Pack (Mar 29-Dec 29) +0.025 to +0.030
SOFR FIXES AND PRIOR SESSION REFERENCE RATES
SOFR Benchmark Settlements:
US TSYS: Repo Reference Rates
STIR: FRBNY EFFR for prior session:
FED Reverse Repo Operation
RRP usage climbs to $193.378B this afternoon from $149.503B Tuesday. Compares to $58.770B (lowest level since mid-April 2021) on February 14. The number of counterparties at 47 from 39 prior.
MNI PIPELINE: Corporate Bond Roundup: $500M BOC Luxembourg 3Y SOFR Priced
Dearth of issuance in the lead up to this afternoon's FOMC annc
MNI BONDS: EGBs-GILTS CASH CLOSE: Gilts Outperform Ahead Of BoE
Gilts outperformed Bunds Wednesday ahead of the BoE.
Closing Yields / 10-Yr EGB Spreads To Germany
MNI FOREX: USDJPY Sinks Post-Fed, Technical Outlook Remain Bearish
THURSDAY DATA CALENDAR
Date | GMT/Local | Impact | Country | Event |
20/03/2025 | 0700/0700 | *** | ![]() | Labour Market Survey |
20/03/2025 | 0700/0800 | ** | ![]() | PPI |
20/03/2025 | 0800/0900 | ![]() | ECB's Lagarde At ECON Hearing | |
20/03/2025 | 0830/0930 | *** | ![]() | SNB PolicyRate |
20/03/2025 | 0830/0930 | *** | ![]() | Riksbank Interest Rate Decison |
20/03/2025 | 0830/0930 | *** | ![]() | SNB Interest Rate Decision |
20/03/2025 | 0900/1000 | ![]() | Q1 Regional Network Survey | |
20/03/2025 | 1000/1100 | ** | ![]() | Construction Production |
20/03/2025 | 1100/1100 | ** | ![]() | CBI Industrial Trends |
20/03/2025 | 1200/1200 | *** | ![]() | Bank Of England Interest Rate |
20/03/2025 | 1200/1200 | *** | ![]() | Bank Of England Interest Rate |
20/03/2025 | 1200/1300 | ![]() | ECB's Lane At UCC Economics Society's Conference | |
20/03/2025 | 1200/1200 | ![]() | Agents summary of business conditions | |
20/03/2025 | 1230/0830 | * | ![]() | Industrial Product and Raw Material Price Index |
20/03/2025 | 1230/0830 | *** | ![]() | Jobless Claims |
20/03/2025 | 1230/0830 | ** | ![]() | WASDE Weekly Import/Export |
20/03/2025 | 1230/0830 | ** | ![]() | Philadelphia Fed Manufacturing Index |
20/03/2025 | 1230/0830 | * | ![]() | Current Account Balance |
20/03/2025 | 1400/1000 | *** | ![]() | NAR existing home sales |
20/03/2025 | 1430/1030 | ** | ![]() | Natural Gas Stocks |
20/03/2025 | 1530/1130 | ** | ![]() | US Bill 04 Week Treasury Auction Result |
20/03/2025 | 1530/1130 | * | ![]() | US Bill 08 Week Treasury Auction Result |
20/03/2025 | 1650/1250 | ![]() | BOC Governor speaks in Calgary | |
20/03/2025 | 1700/1300 | ** | ![]() | US Treasury Auction Result for TIPS 10 Year Note |
21/03/2025 | 2330/0830 | *** | ![]() | CPI |
21/03/2025 | 0001/0001 | ** | ![]() | Gfk Monthly Consumer Confidence |