MNI ASIA OPEN: SCOTUS Sceptical on Tariff Defense

EXECUTIVE SUMMARY

• MNI US: Trump Urges GOP Senators To Terminate Filibuster, Reopen Government
• MNI TARIFFS: Conservative SCOTUS Justices Sceptical Of Trump's Tariff Defence
• MNI US: Democrats Harden Stance On Deal To Reopen Govt In Light Of Election Results
• MNI US DATA: ISM Services Activity Bounces Strongly In October, But Prices Edge Up
• MNI US DATA: October Services PMI Trimmed In Final Print, Margin Compression Noted
• MNI US DATA: ADP Confirms Payroll Stabilization In October, Trend Still Very Soft

US

MNI Fed Miran at Yahoo Finance interview: "*MIRAN: WOULD THINK IT'S STILL REASONABLE TO CONTINUE RATE CUTS" Bbg

MNI US: Trump Urges GOP Senators To Terminate Filibuster, Reopen Government

US President Donald Trump is delivering remarks to a White House breakfast for Senate Republicans. Trump is using the remarks to renew pressure on Senate Republicans to 'do what they have to do' and terminate the Senate filibuster to unilaterally end the government shutdown.

MNI US: Thune Says No Votes To Terminate Filibuster, Shutdown Pessimism Surges

Senate Majority Leader John Thune (R-SD) told reporters there is insufficient Republican support to terminate the Senate filibuster, after President Donald Trump urged the move at a White House breakfast this morning. “I know where math is on this issue in the Senate. It’s just not happening,” Thune said Semafor. 

MNI TARIFFS: Conservative SCOTUS Justices Skeptical Of Trump's Tariff Defence

Conservative Supreme Court justices Amy Coney Barrett, Neil Gorsuch, and Chief Justice John Roberts all appeared sceptical of President Donald Trump’s reciprocal tariffs, during questions to Trump’s lawyer during today’s hearing. The implied probability of Trump winning the case has dropped to 20%, per Polymarket. “A loss wouldn’t completely unwind the Trump agenda. IEEPA tariffs account for roughly half of the tariff revenue that the government has so far collected in the 2025 fiscal year,” NYT reported yesterday.

Figure 1: Supreme Court Rules in Favour of Trump’s Tariffs Source: Polymarket

MNI US: Democrats Harden Stance On Deal To Reopen Govt In Light Of Election Results

Sarah Ferris at CNN reports on X, “Senate Dems involved in talks to end shutdown are using election to try to spur GOP to back a framework to temporarily extend ACA with some reforms to reopen govt, per 2 sources. “With that it ends fast; without we stare at each other another week.” The report appears to confirm that the ‘blue wave’ overperformance at yesterday’s elections has bolstered Democrats' position that a hardline stance on reopening the government is endorsed by voters.

NEWS

MNI RUSSIA: Putin-"We Will Have To Take Retaliatory Action If Nuclear Tests Resume"

Chairing a meeting of the permanent National Security Council, President Vladimir Putin says that US President Donald Trump's comments regarding the US resuming nuclear testing are "a serious issue". Says Russia "has always strictly observed its obligations under the Comprehensive Nuclear-Test-Ban Treaty and will continue to do so," but also asked departments "to submit proposals on the possibility of preparing for nuclear weapons tests".

MNI UK: Labour Risks Falling To 3rd In Polls With Budget Statement Looming

The gov't faces a difficult few weeks ahead of the 26 November budget in the wake of Chancellor of the Exchequer Rachel Reeves' Downing St. speech on 4 November that refused to rule out manifesto-breaking income tax/VAT/National Insurance increases. 

US TSYS

MNI US TSYS: ADP Payrolls Growth Stabilized, Tsy Contemplates Coupon Size Inc

• Tsys initially retreated after larger than expected ADP jobs gain - then extended lows after in-line refunding annc - while coupon sizes expected to remain stable for "at least the next several quarters" - Tsy contemplating coupon size increase and no discussion of ramping up bills in lieu adding to bear curve steepening.
• Tsys tracked German Bunds lower with no obvious headline of Block driver, unlikely that comment from Fed Miran adding to the decline: "DATA SUGGEST RATES CAN BE A LITTLE LOWER THAN THEY ARE" while "KEEPING POLICY THAT RESTRICTIVE RUNS UNNECESSARY RISKS," Bbg.
• Currently, the Dec'25 10Y contract trades -15 at 112-10 vs. 112-09.5 low, nearing the reversal trigger at 112-06. The weakness was triggered by the clean break below the 50-day EMA, currently at 112-26+, and highlights potential for a deeper retracement near-term. 10Y yield +.0720 at 4.1571%. Curves bear steepen: 2s10s +1.637 at 52.366, 5s30s +.412 at 97.121.
• Conservative Supreme Court justices Amy Coney Barrett, Neil Gorsuch, and Chief Justice John Roberts all appeared sceptical of President Donald Trump’s reciprocal tariffs, during questions to Trump’s lawyer during today’s hearing. The implied probability of Trump winning the case has dropped to 20%, per Polymarket.
• Due to the ongoing, weekly Jobless Claims, Non-Farm Productivity / Unit Labor Costs and Wholesale Inventories / Sales has been suspended. That leaves: Challenger Job Cuts (0730ET), Revelio Public Labor Statistics and Chicago Fed Labor Market Indicator (both 0830ET).
• Myriad Fed speakers on tap tomorrow: NY Fed Williams lecture at Goethe Univ. Frankfurt (1100ET), Fed Gov Barr moderated discussion community development (1100ET), Cleveland Fed Hammack Economic Club of NY (1200ET), Fed Gov Waller CB & Payments panel (1530ET), Philly Fed Paulson Consumer Finance Inst (1630ET), StL Fed Musalem fireside chat on policy (1730ET).

OVERNIGHT DATA

MNI US DATA: ISM Services Activity Bounces Strongly In October, But Prices Edge Up

October's ISM Services report was the strongest overall since early in the year, with the headline PMI index rising to 52.4 from 50.0 for an 8-month high. This easily exceeded the expectation for a slight uptick to 50.8 and came with improvements in most of the key subcomponents, though employment remained weak and there were signs of continuing acute inflationary pressures. 

• October saw better readings in Business Activity/Production (+4.4 to 54.3, largely reversing a 5.1 point drop in September), New Orders (+5.8 to a 12-month high 56.2 vs 51.0 expected, likewise reversing a 5.6 point fall in September), Employment (+1.0 to a still-contractionary 48.2 but vs 47.6 expected and a 5-month high), New Export Orders (+1.3 to 4-month high 47.8), and Inventories (+1.7 to 49.5).
• Overall, "comments from many industries mentioned continuing demand stability.”

MNI US DATA: October Services PMI Trimmed In Final Print, Margin Compression Noted

The S&P Global service PMI saw a reasonably large downward revision in the final October print although still firmed from September for still its highest since July. At 54.8, it’s still likely to show a much more optimistic business activity than the 50.8 expected for ISM services after its 50.0. Within the S&P Global survey, note growing margin compression in the comment below. 

• S&P Global US services PMI: 54.8 in Oct final (cons & flash 55.2) after 54.2 in September
• S&P Global US composite PMI: 54.6 in Oct final (cons 54.9 & flash 54.8) after 53.9 in September

MNI US DATA: ADP Confirms Payroll Stabilization In October, Trend Still Very Soft

ADP private payrolls growth stabilized in October after two monthly declines, coming in between Bloomberg consensus and last week’s fresh ADP New Pulse report along with minimal revisions. The combination drove only a marginal hawkish reaction. ADP employment change: 42k (cons 30k) in October after -29k (initial -32k) in Sept and -3k (initial -3k) in Aug.  

• Whilst a small beat of consensus at 30k, it’s also not as solid as the 57k implied by last week’s newly published weekly series for the four weeks ending Oct 11, i.e. just shy of the reference period used for this month’s October report.

MNI US: November Refunding: Starting To Considering Futures Increases To Coupon Size

• Treasury left nominal Treasury coupon auction sizes unchanged for a 7th straight quarter and kept guidance that it anticipates maintaining coupon sizes for "at least the next several quarters."
• New added guidance hints that an increase is coming: "Looking ahead, Treasury has begun to preliminarily consider future increases to nominal coupon and FRN auction sizes, with a focus on evaluating trends in structural demand and assessing potential costs and risks of various issuance profiles." 

The below table shows the actual auction sizes for the August to October 2025 quarter and the anticipated auction sizes for the November 2025 to January 2026 quarter, in billions of dollars. 

MNI CANADA DATA: PMI Indicates Return To Expansion For Services, But Outlook Flat

Canadian Services PMI jumped in October to 50.5 from 46.3 prior, an 11-month high. It's the first above-50 reading since November 2024 and the 3rd highest reading in the last 29 months. The report itself isn't so enthusiastic about the significance of this development however: "Whilst a noticeable improvement on the severe declines seen earlier in the year, growth was nonetheless marginal as some hesitancy and uncertainty amongst clients continued to weigh on new business volumes.

MARKETS SNAPSHOT

Key market levels of markets in late NY trade:
DJIA up 309.97 points (0.66%) at 47391.91
S&P E-Mini Future up 50.25 points (0.74%) at 6851.75
Nasdaq up 256.8 points (1.1%) at 23605.33
US 10-Yr yield is up 7 bps at 4.1552%
US Dec 10-Yr futures are down 14/32 at 112-11
EURUSD up 0.0009 (0.08%) at 1.1491
USDJPY up 0.43 (0.28%) at 154.09
WTI Crude Oil (front-month) down $0.94 (-1.55%) at $59.64
Gold is up $54.91 (1.4%) at $3987.67

European bourses closing levels:
EuroStoxx 50 up 8.93 points (0.16%) at 5669.13
FTSE 100 up 62.12 points (0.64%) at 9777.08
German DAX up 100.63 points (0.42%) at 24049.74
French CAC 40 up 6.7 points (0.08%) at 8074.23

US TREASURY FUTURES CLOSE

3M10Y +6.784, 26.761 (L: 16.685 / H: 27.152)
2Y10Y +1.843, 52.572 (L: 49.883 / H: 53.18)
2Y30Y +2.152, 110.83 (L: 108.235 / H: 111.514)
5Y30Y +0.707, 97.416 (L: 96.282 / H: 98.605)
Current futures levels:
Dec 2-Yr futures down 2.875/32 at 104-2.5 (L: 104-02 / H: 104-07.5)
Dec 5-Yr futures down 8.5/32 at 109-0.25 (L: 108-31.5 / H: 109-14.5)
Dec 10-Yr futures down 14.5/32 at 112-10.5 (L: 112-09.5 / H: 113-02)
Dec 30-Yr futures down 31/32 at 116-14 (L: 116-11 / H: 117-28)
Dec Ultra futures down 1-10/32 at 120-0 (L: 119-29 / H: 121-29)

MNI US 10YR FUTURE TECHS: (Z5) Spills to New Lows

• RES 4: 114-02   High Oct 17 and the bull trigger
• RES 3: 113-29   High Oct 22
• RES 2: 113-18+ High Oct 28
• RES 1: 113-02   Intraday high
• PRICE:‌‌ 112-10+ @ 16:49 GMT Nov 5
• SUP 1: 112-09+ Low Nov 5
• SUP 2: 112-08+ 38.2% retracement of May - Oct Upleg
• SUP 3: 112-06   Low Sep 25 and a reversal trigger & 100-dma
• SUP 4: 111-30+ Trendline support drawn from the May 22 low 

A short-term bearish threat in Treasuries built further Wednesday, with prices nearing the reversal trigger at 112-06. The weakness was triggered by the clean break below the 50-day EMA, currently at 112-26+, and highlights potential for a deeper retracement near-term. The contract needs to trade above 113-18+, the Oct 28 high to signal a possible bullish reversal. Key resistance and the bull trigger is at 114-02, the Oct 17 high.

SOFR FUTURES CLOSE

Current White pack (Dec 25-Sep 26):
Dec 25 -0.025 at 96.225
Mar 26 -0.040 at 96.395
Jun 26 -0.055 at 96.610
Sep 26 -0.060 at 96.760
Red Pack (Dec 26-Sep 27) -0.06 to -0.055
Green Pack (Dec 27-Sep 28) -0.06 to -0.06
Blue Pack (Dec 28-Sep 29) -0.055 to -0.055
Gold Pack (Dec 29-Sep 30) -0.055 to -0.05

REFERENCE RATES
​​​​​​​
US TSYS: Repo Reference Rates

• Secured Overnight Financing Rate (SOFR): 4.00% (-0.13), volume: $3.147T
• Broad General Collateral Rate (BGCR): 3.98% (-0.11), volume: $1.183T
• Tri-Party General Collateral Rate (TCR): 3.98% (-0.11), volume: $1.156T
• (rate, volume levels reflect prior session)

STIR: FRBNY EFFR for prior session:

• Daily Effective Fed Funds Rate: 3.87% (+0.00), volume: $94B
• Daily Overnight Bank Funding Rate: 3.87% (+0.00), volume: $165B

FED Reverse Repo Operation

RRP usage slips to $12.700B with 12 counterparties this afternoon - from $16.893B Tuesday. Compares to $2.435B on October 24 (lowest level since mid-March 2021) and the year's highest usage of $460.731B on June 30.

MNI PIPELINE: Corporate Bond Update: Over $9.5B Debt to Issue Wednesday

• $9.65B to price Wednesday, $56.05B/wk
• Date $MM Issuer (Priced *, Launch #)
• 11/05 $1.7B #Transcontinental Gas Pipeline $1B 10Y +95, $700M 30Y +105
• 11/05 $1.25B #Intercontinental Exchange $600M 3Y +45, $650M +5Y +60
• 11/05 $1.25B #Equinix 5Y +85
• 11/05 $1B #Santos Finance 10Y +168
• 11/05 $850M #AviLease Capital 5Y +110
• 11/05 $750M #Apollo Global Mgt $400M 5Y +85, $350M 8/35 Tap +110
• 11/05 $750M #CBRE Services 7Y +98
• 11/05 $600M #Mattel 5Y +130
• 11/05 $500M #Polaris +5Y +185
• 11/05 $1B *KEPCO $600M 3Y SOFR+62, $400M 5Y +47

MNI BONDS: EGBs-GILTS CASH CLOSE: Gilts Underperform Ahead Of BOE

European yields rose Wednesday. with Gilts underperforming.

• Core EGBs and Gilts traded flat in the European morning, with some downward bias as Services PMIs were revised up from flash in the final for the UK, France and Germany (with Italy and Spain coming in above-expected) and anticipation grew of a nearer-term resolution to the US federal government shutdown.
• Yields rose through the afternoon led by US Treasuries, following stronger than expected US data (ISM Services, ADP private payrolls).
• In other data, the ECB's  latest forward-looking wage tracker was revised up marginally, while German September factory orders were a little stronger than expected.
• On the day both the German and UK curves bear steepened, with Gilts underperforming ahead of Thursday's BOE decision announcement.
• Periphery/semi-core EGB spreads widened slightly.
• The BOE is Thursday's market focus. MNI's preview is here - we characterise our view as 50/50 (when it comes to a cut or a hold), which is comfortably more dovish than current market pricing.

Closing Yields / 10-Yr EGB Spreads To Germany

• Germany: The 2-Yr yield is up 0.7bps at 2.004%, 5-Yr is up 1.5bps at 2.27%, 10-Yr is up 1.9bps at 2.673%, and 30-Yr is up 2.2bps at 3.259%.
• UK: The 2-Yr yield is up 2bps at 3.804%, 5-Yr is up 3.1bps at 3.93%, 10-Yr is up 3.8bps at 4.463%, and 30-Yr is up 4.5bps at 5.249%.
• Italian BTP spread up 0.5bps at 75.1bps / French OAT up 0.3bps at 78.5bps  

MNI FOREX: USDJPY Bounce Affirms Pullbacks are Technically Corrective

• Despite the impressive surge higher for US yields on Wednesday, the USD index is holding at unchanged levels on the day, as a recovery for major equity indices today offsets the most recent greenback enthusiasm. Despite this, the DXY did make fresh 5-month highs, with a firmer-than-expected ISM services PMI supportive.
• Most of the G10 currency action has been centred around the Yen once more, with USDJPY posting an impressive 140 pip range on Wednesday. Initial risk off during SPAC hours and a moderately hawkish set of BOJ minutes prompted USDJPY to extend its pullback to 152.96, however, the subsequent recovery has been very notable.
• The pair’s intraday bounce picked up pace in late European trade, printing a new daily high through the London close. A break above yesterday's 154.48 would mark a full reversal of the JPY strength tripped by Katayama's warnings on FX movements on Tuesday - and again shows that USDJPY is a key beneficiary in a higher US yields environment.
• Today's price action affirms the view that pullbacks are technically corrective in nature, and a break of 154.39/48 supports a rally toward 154.80, the Feb 12th high.
• The more stable risk sentiment has allowed AUD and NZD to outperform, rising around 0.3% against the greenback, although these advances are yet to erode the prior declines this week.
• USDCAD remains a touch higher on the day above 1.41, looking to extend its winning streak to five sessions. Importantly, the pair has held an important resistance for now, the top of the bull channel drawn from the Jul 23 low.
• Higher equities boosted EM FX significantly, with the likes of MXN, ZAR and BRL shrugging off the moves for US yields. USDMXN has now reversed over 1% from intra-day highs, helping the pair edge back below 18.60 in late trade.
• The Bank of England headlines the economic calendar on Thursday, and is potentially set to be a close call decision between a hold and a 25bp cut.

THURSDAY DATA CALENDAR

Date	GMT/Local	Impact	Country	Event
06/11/2025	0700/0800	**	DE	Industrial Production
06/11/2025	0700/0800	***	SE	Flash Inflation Report
06/11/2025	0700/0800	***	SE	Flash Inflation Report
06/11/2025	0800/0900	**	ES	Industrial Production
06/11/2025	0800/0900	**	CH	Unemployment
06/11/2025	0810/0910		EU	ECB Schnabel At ECB Money Market Conference
06/11/2025	0830/0930	**	EU	S&P Global Final Eurozone Construction PMI
06/11/2025	0830/0930		EU	ECB De Guindos On Natixis Webinar
06/11/2025	0900/1000	***	NO	Norges Bank Rate Decision
06/11/2025	0930/0930	**	GB	S&P Global/CIPS Construction PMI
06/11/2025	1000/1100	**	EU	EZ Retail Sales
06/11/2025	1200/1200	***	GB	Bank Of England Interest Rate
06/11/2025	1200/1200	***	GB	Bank Of England Interest Rate
06/11/2025	1230/1230		GB	BOE Press Conference
06/11/2025	1330/0830	***	US	* Jobless Claims - suspended
06/11/2025	1330/0830	**	US	WASDE Weekly Import/Export - suspended
06/11/2025	1330/0830	**	US	* Preliminary Non-Farm Productivity - suspended
06/11/2025	1400/1400		GB	Decision Maker Panel Data
06/11/2025	1500/1000	*	CA	Ivey PMI
06/11/2025	1500/1000	**	US	*Wholesale Trade - suspended
06/11/2025	1500/1000	**	US	*Wholesale Trade - suspended
06/11/2025	1530/1030	**	US	Natural Gas Stocks
06/11/2025	1530/1030		CA	BOC Governor Macklem testifies at Senate.
06/11/2025	1600/1100		US	NY Fed's John Williams
06/11/2025	1600/1100		US	Fed Governor Michael Barr
06/11/2025	1630/1130	*	US	US Bill 08 Week Treasury Auction Result
06/11/2025	1630/1130	**	US	US Bill 04 Week Treasury Auction Result
06/11/2025	1700/1200		US	Cleveland Fed's Beth Hammack
06/11/2025	1830/1930		EU	ECB Lane At IMF Conference
06/11/2025	1900/1400	***	MX	Mexico Interest Rate
06/11/2025	2030/1530		US	Fed Governor Christopher Waller
06/11/2025	2130/1630		US	Philly Fed's Anna Paulson
06/11/2025	2230/1730		US	St. Louis Fed's Alberto Musalem
07/11/2025	2330/0830	**	JP	Household spending