MNI ASIA OPEN: Tsys & Stocks Rally, Muted Iranian Response
EXECUTIVE SUMMARY
- MNI FED: Bowman And Waller Setting Up For A July Dissent
- MNI FED: VC Bowman Eyes July Cut Amid Inflation Progress, Labor Market "Fragility"
- MNI US DATA: More Warning Signs In Housing Despite Existing Home Sales Pickup
- MNI US DATA: Flash PMIs Cool By Less Than Expected
US
MNI BRIEF: No Tariff Inflation Could Mean Fed Cuts - Goolsbee
The Federal Reserve could resume cutting interest rates if expectations for tariffs to lead to price rises do not materialize soon, Chicago Fed President Austan Goolsbee said Monday. Goolsbee said he’s been surprised at the absence of any inflation spikes since tariffs were first announced in April.
MNI FED: Bowman And Waller Setting Up For A July Dissent
Though both Gov Waller and Vice Chair Bowman have come out after the June meeting and declared tentative support for a rate cut in July, this still appears to be a minority view. They might be the two biggest doves on 2025 rates. While the SEP is not a perfect guide to guessing policy preferences, there were two.
MNI FED: VC Bowman Eyes July Cut Amid Inflation Progress, Labor Market "Fragility"
Fed Vice Chair Bowman, one of the most hawkish FOMC members coming into the year (and a permanent voter), appears to now be on the most dovish end of the spectrum in suggesting she conditionally would support a rate cut as soon as the next meeting in July. This doesn't appear to be a widely shared view on the Committee (only expressed by Gov Waller so far) but it is a jarring shift in view.
NEWS
MNI SECURITY: Speculation Increases Of Iranian Strike On US Base In Qatar
Following an earlier report from Amwaj Media, there is increasing speculation from analysts and journalists that an Iranian strike could target US military assets in Qatar. Reuters notes: “Qatar said it has shut down airspace temporarily as part of measures taken amid developments in the region, a statement by the Qatari foreign ministry said on X... The shutdown of Qatari airspace comes as Iran repeated earlier threats to retaliate against the United States after strikes on its nuclear sites.”
CHINA: INDIA-Wang Talks Up 'Positive Progress' In Beijing-Delhi Relations
(MNI) London - The Chinese Foreign Ministry has issued a statement following a meeting between Foreign Minister Wang Yi and India's National Security Advisor Ajit Doval in Beijing earlier today. The two sides have increased communication over the past 12 months in an effort to maintain the uneasy peace along the disputed Himalayan border between the two countries (the Line of Actual Control, LAC).
US TSYS
MNI US TSYS: Tsys Bid With Stocks, Not the Reaction You Were Expecting
- Treasuries looked to finish higher Monday (TYU5 +11.5 at 111-11), curves bull steepening (2s10s +2.645 at 49.176) as rates & stocks rallied on initially muted response by Iran to US bombing over the weekend.
- Stocks extended gains even after Iran launched missiles at US base in Qatar, possible face saving measure as Iran warned US prior, most if not all missiles intercepted.
- Risk gained traction on dovish comments on potential rate cuts from Fed VC Bowman and Chicago Fed Goolsbee if inflation remains muted.
- Projected rate cut pricing gains traction vs. this morning's levels (*), Dec at the highest since May 12: Jul'25 at -5.9bp (-3.6bp), Sep'25 at -25.2bp (-19.5bp), Oct'25 at -32.6bp (-40.7bp), Dec'25 at -58.8bp (-49.9bp).
- Existing home sales unexpectedly ticked up in May to a 4.03M seasonally-adjusted annual pace, from 4.00M in April (and vs 3.95M survey).
- Flash S&P manufacturing PMI held steady at 52.0 for a second month (cons 51.0) after 50.2 in both March and April whilst services dipped to 53.1 (cons 53.0) after 53.7 in May.
OVERNIGHT DATA
MNI US DATA: More Warning Signs In Housing Despite Existing Home Sales Pickup
Existing home sales unexpectedly ticked up in May to a 4.03M seasonally-adjusted annual pace, from 4.00M in April (and vs 3.95M survey). While the lack of further deterioration is a slightly brighter note for a beleaguered housing market, existing sales were down 0.7% Y/Y and remain well below pre-pandemic levels (and indeed are running about the same rate as the worst point of the initial part of the pandemic in 2020).
MNI US DATA: Flash PMIs Cool By Less Than Expected
The S&P Global US PMIs were stronger than expected in the flash June releases as they cooled only modestly after May's improvement. The manufacturing PMI held steady at 52.0 for a second month (cons 51.0) after 50.2 in both March and April whilst services dipped to 53.1 (cons 53.0) after 53.7 in May.
MARKETS SNAPSHOT
Key market levels of markets in late NY trade:
DJIA up 313.6 points (0.74%) at 42514.26
S&P E-Mini Future up 51.5 points (0.86%) at 6069
Nasdaq up 165.6 points (0.9%) at 19612.11
US 10-Yr yield is down 4.1 bps at 4.3338%
US Sep 10-Yr futures are up 11.5/32 at 111-11
EURUSD up 0.0054 (0.47%) at 1.1577
USDJPY up 0.03 (0.02%) at 146.13
WTI Crude Oil (front-month) down $5.11 (-6.92%) at $68.72
Gold is up $13.17 (0.39%) at $3381.32
European bourses closing levels:
EuroStoxx 50 down 11.68 points (-0.22%) at 5221.9
FTSE 100 down 16.61 points (-0.19%) at 8758.04
German DAX down 81.54 points (-0.35%) at 23269.01
French CAC 40 down 52.09 points (-0.69%) at 7537.57
US TREASURY FUTURES CLOSE
3M10Y +0.311, 6.33 (L: 0.879 / H: 7.987)
2Y10Y +2.63, 49.161 (L: 43.663 / H: 49.191)
2Y30Y +4.942, 102.929 (L: 96.228 / H: 103.03)
5Y30Y +4.668, 97.376 (L: 91.756 / H: 97.477)
Current futures levels:
Sep 2-Yr futures up 4.25/32 at 103-26.875 (L: 103-21 / H: 103-28.75)
Sep 5-Yr futures up 9/32 at 108-17.25 (L: 108-04 / H: 108-22.5)
Sep 10-Yr futures up 11.5/32 at 111-11 (L: 110-25 / H: 111-20.5)
Sep 30-Yr futures up 12/32 at 114-5 (L: 113-08 / H: 114-23)
Sep Ultra futures up 12/32 at 117-9 (L: 116-09 / H: 118-02)
MNI US 10YR FUTURE TECHS: (U5) Monitoring Resistance
- RES 4: 111-30 76.4% retracement of the May 1 - 22 downleg
- RES 3: 111-21+ 1.0% 10-dma envelope
- RES 2: 111-14+ High Jun 5 & 61.8% of the May 1 - 22 downleg
- RES 1: 111-13 High Jun 13
- PRICE: 110-29+ @ 11:16 BST Jun 23
- SUP 1: 110-10+/109-28 Low Jun 16 / Low Jun 6 / 11
- SUP 2: 109-12+ Low May 22 and the bear trigger
- SUP 3: 109-09+ Low Apr 11 and key support
- SUP 4: 108-25+ 0.764 proj of the Apr 7 - 11 - May 1 price swing
Treasury futures continue to trade below a key resistance at 111-14+, a Fibonacci retracement and the Jun 5 high. A clear break of this hurdle is required to highlight a stronger reversal. This would open 111-30, a Fibonacci retracement. On the downside, initial firm support to watch lies at 109-28, the Jun 6 / 11 low. Clearance of this support would be bearish and open the bear trigger at 109-12+, the May 22 low.
SOFR FUTURES CLOSE
Sep 25 +0.050 at 95.945
Dec 25 +0.060 at 96.215
Mar 26 +0.080 at 96.450
Jun 26 +0.085 at 96.665
Red Pack (Sep 26-Jun 27) +0.075 to +0.080
Green Pack (Sep 27-Jun 28) +0.060 to +0.075
Blue Pack (Sep 28-Jun 29) +0.045 to +0.060
Gold Pack (Sep 29-Jun 30) +0.030 to +0.040
REFERENCE RATES (PRIOR SESSION)
US TSYS: Repo Reference Rates
- Secured Overnight Financing Rate (SOFR): 4.29% (+0.01), volume: $2.700T
- Broad General Collateral Rate (BGCR): 4.27% (+0.00), volume: $1.083T
- Tri-Party General Collateral Rate (TCR): 4.27% (+0.00), volume: $1.060T
- (rate, volume levels reflect prior session)
STIR: FRBNY EFFR for prior session:
- Daily Effective Fed Funds Rate: 4.33% (+0.00), volume: $118B
- Daily Overnight Bank Funding Rate: 4.33% (+0.00), volume: $298B
FED Reverse Repo Operation
RRP usage rebounds to $165.319B this afternoon from $138.283B Friday, total number of counterparties at 34. Usage had fallen to $54.772B on Wednesday, April 16 -- lowest level since April 2021. Conversely, usage had surged to the highest level since December 31, 2024 on Monday, March 31: $399.167B.
MNI PIPELINE: Corporate Bond Update: $3.5B JBS, $1.65B NiSource Launched
- Date $MM Issuer (Priced *, Launch #)
- 06/23 $3.5B #JBS USA $1.25B +10Y +125, $1.25B +30Y +140, $1B +40Y +155
- 06/23 $1.65B #NiSource $900M 10Y +105, $750M 30Y +115
- 06/23 $1.5B #BNP Paribas PerpNC10 7.45%
- 06/23 $1B #Marvell Tech $500M 5Y +87.5, $500M 10Y +115
- 06/23 $800M #Public Service of Oklahoma +10Y +115
- 06/23 $500M *KT Corp 3.5Y +72
- 06/23 $500M *Turk Eximbank WNG 3Y 7%
- 06/23 $500M Barbados 10Y 8%a
- 06/23 $Benchmark Nomura PerpNC5.5, 5Y, 10Y
- 06/23 $Benchmark Mexico 7Y +175, +12Y +230
- On tap for Tuesday
- 06/24 $1B CAF 3Y SOFR+75a
- 06/24 $Benchmark Denmark 2Y +7a
- 06/24 $Benchmark IFC 5Y SOFR+43a
- 06/24 $Benchmark JBIC 3Y SOFR+48a
MNI BONDS: EGBs-GILTS CASH CLOSE: Yields Pull Back From Early Session Highs
Gilts outperformed EGBs amid an intraday rally Monday.
- Yields jumped in the re-open from the weekend, following the US's bombing of Iranian nuclear sites.
- Global core FI rallied in late morning/early afternoon trade though, with oil prices fading, and dovish comments by a Federal Reserve official (Bowman).
- Eurozone flash June services PMI was in line with expectations, with Germany notably beating consensus; manufacturing was slightly below expected with France notably missing.
- UK manufacturing / services PMI respectively beat/met expectations.
- The German curve leaned bull steeper, with the UK's bull flatter. EGB periphery/semi-core spreads closed slightly tighter.
- Tuesday's data slate includes German IFO and UK CBI trends, while we hear from the majority of the BOE MPC (including Bailey and Pill), as well as multiple ECB speakers.
Closing Yields / 10-Yr EGB Spreads To Germany
- Germany: The 2-Yr yield is down 1.2bps at 1.838%, 5-Yr is down 0.8bps at 2.11%, 10-Yr is down 1bps at 2.507%, and 30-Yr is down 1.1bps at 2.961%.
- UK: The 2-Yr yield is down 3bps at 3.889%, 5-Yr is down 3.5bps at 4.008%, 10-Yr is down 4.5bps at 4.492%, and 30-Yr is down 5.8bps at 5.212%.
- Italian BTP spread down 0.7bps at 97.4bps / Spanish down 0.8bps at 69.1bps
MNI FOREX: US Dollar Extending Intra-Day Reversal Lower
- The intra-day reversal lower for the greenback is extending, as the USD index now trades through last Friday’s lows, roughly 1% below the earlier session highs. Lower oil prices and resilient equity benchmarks are assisting the renewed USD weakness, despite the plethora of headlines crossing surrounding Iran’s launch of missile attacks towards a US air base in Qatar.
- The likes of GBPUSD (+0.50%) and EURUSD (+0.36%) are leading the charge within the G10 complex. For EURUSD, the bullish trend remains firmly in place and scope remains seen for a climb towards 1.1696, a Fibonacci projection. Recovering global sentiment has tilted the likes of AUD and NZD back to unchanged on the day after being the standout laggards earlier on Monday.
- Euro resilience has also been notable against the crosses with the likes of EURAUD and EURNZD holding onto 0.5% gains on the session.
- JPY volatility has not disappointed, although the Japanese currency has followed the broader dollar trend rather than being impacted by safe haven flows. Initially, USDJPY rose as high as 148.03, which may have been exacerbated by positioning dynamics. However, since then, the pair tracks around 180 pips lower, and is edging towards the overnight lows at the 146.00 handle. Below here, support to watch lies at 145.08, the 50-day EMA.
- The main beneficiary on Monday has been the Swiss Franc, as USDCHF falls 0.67% and edges back towards 0.8100, while CHFJPY has appreciated 0.76%. Earlier in the session spot printed up to 180.88, record highs for the cross.
- Focus on the data calendar tomorrow will be on German IFO, Canada CPI and US consumer confidence. Fed Chair Powell will also deliver his congressional testimony.
TUESDAY DATA CALENDAR
| Date | GMT/Local | Impact | Country | Event |
| 24/06/2025 | 0800/1000 | *** |  DE | IFO Business Climate Index |
| 24/06/2025 | 0800/0900 |  GB | BOE Bailey At Gold Standard Conference | |
| 24/06/2025 | 0845/1045 | DE | 2025 Budget Press Conference | |
| 24/06/2025 | 0900/1000 | * | GB | Index Linked Gilt Outright Auction Result |
| 24/06/2025 | 0900/1000 | * | GB | Index Linked Gilt Outright Auction Result |
| 24/06/2025 | 0930/1030 | GB | BOE Green On CB Balance Sheet Mgmt | |
| 24/06/2025 | 1000/1100 | ** | GB | CBI Industrial Trends |
| 24/06/2025 | 1115/1315 |  EU | ECB de Guindos At XLII APIE seminar | |
| 24/06/2025 | 1230/0830 | *** |  CA | CPI |
| 24/06/2025 | 1230/0830 | * |  US | Current Account Balance |
| 24/06/2025 | 1230/0830 | ** | US | Philadelphia Fed Nonmanufacturing Index |
| 24/06/2025 | 1255/0855 | ** | US | Redbook Retail Sales Index |
| 24/06/2025 | 1300/1500 | ** |  BE | BNB Business Confidence |
| 24/06/2025 | 1300/0900 | ** | US | S&P Case-Shiller Home Price Index |
| 24/06/2025 | 1300/0900 | ** | US | FHFA Home Price Index |
| 24/06/2025 | 1300/0900 | ** | US | FHFA Home Price Index |
| 24/06/2025 | 1300/1500 | EU | ECB Lagarde Accepts De Sanctis Award "Europa" | |
| 24/06/2025 | 1315/0915 | US | Cleveland Fed's Beth Hammack | |
| 24/06/2025 | 1335/1435 | GB | BOE Ramsden At Barclays-CEPR MonPol Forum | |
| 24/06/2025 | 1355/1555 | EU | ECB Lane Keynote At Barclays-CEPR MonPol Forum | |
| 24/06/2025 | 1400/1000 | *** | US | Conference Board Consumer Confidence |
| 24/06/2025 | 1400/1000 | ** | US | Richmond Fed Survey |
| 24/06/2025 | 1400/1000 | US | Fed Chair Jay Powell | |
| 24/06/2025 | 1400/1500 | GB | BOE Bailey At Lords Econ Affairs Committee | |
| 24/06/2025 | 1540/1640 | GB | BOE Pill At Gold Standard Conference | |
| 24/06/2025 | 1550/1650 | GB | BOE Breeden At UK Finance Digital Innovation Summit | |
| 24/06/2025 | 1630/1230 | US | New York Fed's John Williams | |
| 24/06/2025 | 1700/1300 | * | US | US Treasury Auction Result for 2 Year Note |
| 24/06/2025 | 1805/1405 | US | Boston Fed's Susan Collins | |
| 24/06/2025 | 2000/1600 | US | Fed Governor Michael Barr | |
| 25/06/2025 | 2301/0001 | * | GB | Brightmine pay deals for whole economy |
| 24/06/2025 | 0015/2015 | US | Kansas City Fed's Jeff Schmid | |
| 25/06/2025 | 0130/1130 | *** |  AU | CPI Inflation Monthly |
