ECB: MNI ECB Review: You Could Argue That We Are On Hold

Bloomberg reports (link) that the EU is planning to impose retaliatory tariffs on US imports, including on Boeing, if President Trump puts a baseline levy on the bloc’s goods. Deliberations continue ahead of a July 9 deadline that will see sweeping tariff rates of 50% on nearly all EU exports. 

• From the piece: “EU officials expect the US to keep some duties in place, even after trade negotiations are concluded. Until now, the European Commission, which handles trade matters for the EU, hasn’t indicated if that would trigger retaliation from the bloc.”
• Recall that last week saw Reuters report European officials as increasingly resigned to the 10% baseline rate on reciprocal tariffs in any US-EU trade deal.
• One of the sources, an EU official, said negotiating the level down had become harder since the U.S. started drawing revenues from its global tariffs. "10% is a sticky issue. We are pressing them but now they are getting revenues," said the official. 

• Date $MM Issuer (Priced *, Launch #)
• 06/24 $2.5B #Kazakhstan $1.35B 7Y 5%, $1.15B 12Y 5.5%
• 06/24 $2.2B #Imperial Brands $850M 3Y +85, $850M 10Y +140, $500M 30Y +158
• 06/24 $1.5B #Toyota $500M 2Y +38, $500M 5Y +60, $500M 10Y +77
• 06/24 $1.5B *Denmark 2Y +4
• 06/24 $1B #JBIC 3Y SOFR+44
• 06/24 $500M #China Development Bank 5Y SOFR+30
• 06/24 $2B IFC 5Y SOFR+41
• 06/24 $1B *CAF 3Y SOFR+69
• 06/24 $Benchmark Ladder Capital 5Y +167
• 06/24 $Benchmark Westpac 5Y +50, 5Y SOFR+82
• 06/24 $Benchmark American National Group 10Y +175
• 06/24 $Benchmark Nomura PerpNC5.5 7%, 5Y +105, 10Y +120
  • Expected Wednesday:
  • 06/25 $Benchmark Swedish Export Cr 2Y SOFR+36a

Tuesday's Europe rates/bond options flow included:

• DUQ5 107.30/107.20/107.00 broken p ladder, bought for 1.75 in 4k
• ERQ5 98.12/98.1875cs vs 97.9375p bought the cs for 1.5 in 4k
• ERU5 98.125/98.25/98.375c fly, bought for 3.25 in 10k
• ERU5 98.12/98.1875/98.25c ladder, bought for 1 in 4k
• 0RU5 98.375/98.25/98.125p fly vs 97.875p, bought the fly for -0.5 in 8k