STIR: Modest Dovish Reaction To ADP, Just Under 60bp Fed Cuts Priced For '26
Jan-07 13:27
Slightly-lower-than-expected ADP employment data has a very modest dovish impact on USD STIRs, although the reaction is limited by a marginally positive revision and lack of meaningful deviation from expectations (+41K ADP well within the wide 10-80K range of estimates seen in the BBG survey and not too far from the +50K median).
- SOFR futures little changed vs. pre-release levels, flat to 4.5.
- FOMC-dated OIS still showing ~59.5bp of easing through year-end, with the next 25bp cut fully discounted through the end of the June FOMC (4bp priced for Jan, 13bp through Mar, 19bp through April and 33bp through June).
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EURIBOR OPTIONS: ERU6 98.00/98.12 Call Spread Lifted vs. 97.87/97.75 Put Spread
Dec-08 13:03
ERU6 98.00/98.12 call spread vs. 97.87/97.75 put spread paper paid -0.5 on 25K, buying the call spread.
US TSYS/SUPPLY: MNI UST Issuance Deep Dive: December 2025
Dec-08 13:03
We've just published our latest US Treasury issuance Deep Dive - Download Full Report Here
- The latest Treasury Refunding policy statement out Nov 5 contained no change to guidance on maintaining auction sizes "for at least the next several quarters", as expected.
- However, Treasury made its biggest hint in quite a while that increases are on the foreseeable horizon: "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."
- While it certainly doesn't mean there will be increases in at least the next 2 and almost certainly 3 quarters, it is an unexpected development and seems consistent with MNI's baseline expectation that the next upsizing could be in a year from now (November 2026).
- Upcoming issuance: December’s issuance schedule is set to see $315B in nominal Treasury coupon sales (unch from the equivalent month in the previous quarter), in addition to $24B in 5Y TIPS and $28B FRN for a total of $367B.
MNI EXCLUSIVE: MNI interviews former St. Louis Fed president
Dec-08 12:56
MNI interviews former St. Louis Fed president on monetary policy, Fed independence -- On MNI Policy MainWire now, for more details please contact sales@marketnews.com
