POLAND: Nawrocki Meets W/Mentzen, Finance Ministry Holds Downsized Bond Auction

SFRU6/H7 ~4.2K trades at 9.5, initiated by a seller to start.

ECB-dated OIS almost fully price another 25bp cut in June, following the dovish, growth-centric tone of last week’s decision/press conference. OIS almost price another three 25bp cuts this cycle (~71/72bps through Feb/March 2026), implying a terminal rate of just over 1.50%.

• MNI’s ECB review, published last week, is here.
• The Euribor strip has twist steepened, with whites flat to +2.5 ticks and blues -1.5 to -2.5 ticks from Thursday’s settlement levels. The ERM5/M6 spread once again reached a -38.0 tick low (now -2.0 ticks at -37.0 ticks), a breach of which would expose the June 2024 low at -39.5 ticks.
• Yesterday, ECB’s Kazaks said in a blog that “Recession is not currently the base scenario, but with potentially such large-scale changes in geopolitics and global trade, its probability is high”. However, Muller struck a more cautious tone noting that “Financial markets have an expectation that the ECB will further lower interest rates, but it seems to me that we need to be careful in assessing the inflation outlook”.
• Today’s regional data calendar is headlined by the ECB’s Survey of Professional Forecasters at 0900BST/1000CET. Q4 ’24 EU fiscal is also due at 1000BST. 

ERZ5 98.1875/98.4375/98.6875/98.9375c condor, bought for 10 in 14k.