US-EU: Negotiators Aiming For 'Agreement In Principle' On Trade - Von Der Leyen
Jul-03 15:36
European Commission President Ursula von der Leyen told reporters at a press conference in Denmark a short time ago that the EU and US are aiming for a trade “agreement in principle”, noting that a comprehensive deal is impossible before the July 9 deadline.
- Von der Leyen said: “It’s a huge task because we have the largest trade volume globally between the EU and the United States, €1.5tn [annually] — very complex and a huge quantity... Indeed what we are aiming at is an agreement in principle. That is also what the U.K. did."
- Politico notes that EU trade commissioner, Maroš Šefčovič, is in Washington today for talks to push for a deal before the July 9 deadline. He is expected to meet with US Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick.
- EU diplomats told the Financial Times that the bloc, "will probably accept 10 per cent across-the-board levies but still wanted to get cuts to the sectoral tariffs on products such as steel, at 50 per cent, and vehicles and vehicle parts at 25 per cent. It was willing to commit to buying more US goods to cut its trade surplus."
- Bessent and White House economic advisor Kevin Hassett both indicated to reporters in recent days that the Trump administration intends to announce a raft of trade deals when Congress concludes work on the GOP's Big Beautiful Bill. A final vote in the House of Representatives is likely to take place this afternoon.
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SONIA: SFIZ5 Call Spread vs Mid Curve Call Spread
Jun-03 15:22
SFIZ5 96.30/96.50 call spread vs 2NZ5 96.60/96.80 call spread, paper pays 1.75 for 4k
FED: Atlanta's Bostic Sticks To 1 Cut View For 2025, "Ways To Go" On Inflation
Jun-03 15:20
Atlanta Fed President Bostic on Tuesday reiterated his view expressed in the March Dot Plot that he expects one rate cut later this year - "I don’t have any reason to think that my outlook is going to change radically... a lot of it will depend on how the uncertainty resolves itself. I’m going to stay diligent and take things on as they happen."
- That said, tariffs could boost inflation in the near-term - with the persistence vs one-off impact of tariffs still an open debate - and in any case overall PCE remains above target so "there's still a ways to go in terms of the progress we're going to need to see". He noted local business contacts may be putting off price increases until later in the summer.
- He was speaking to reporters after the release of a new essay, "Pervasive Uncertainty Calls for a Patient Policy Stance" (link) - the title of which basically says it all. As he writes, "As of April, we had not yet seen clear signs of tariffs boosting inflation, though research suggests we might see upward pressure on prices over the coming weeks."
- He also notes in the essay, "Fiscal, tax, and regulatory policy are all likely to see big changes in the coming months as Congress works through its budget processes and the Trump Administration continues to implement its agenda. In each area, one could generate a list of questions as long as the set I just offered about trade. For now, neither I nor anyone has clear answers for any of these questions."
PIPELINE: Corporate Bond Update
Jun-03 15:12
- Date $MM Issuer (Priced *, Launch #)
- 06/03 $3B #AfDB: $2B WNG 3Y SOFR+33, $1B WNG 10Y SOFR+64
- 06/03 $2B #Prov. of Ontario: 10Y SOFR+95
- 06/03 $1.5B *CPPIB 5Y SOFR+54
- 06/03 $1.25B *Kommuninvest +3Y SOFR+39
- 06/03 $1B #Hong Kong 5Y Green +50
- 06/03 $500M IADB 2030 tap SOFR+40
- 06/03 $500M Autodesk WNG 10Y +120a
- 06/03 $Benchmark Bank of NY Mellon 3NC2 +75a, 3NC2 SOFR, 11NC10 +100a
- 06/03 $Benchmark GE Healthcare +5Y +110a, 10Y +135a
- 06/03 $Benchmark NAB 3Y +65a, 3Y SOFR, 5Y +75a
- 06/03 $Benchmark Corebridge 5Y +100a
- Expected Wednesday:
- 06/04 $Benchmark IDA 5Y SOFR+46a
- 06/04 $Benchmark British Colombia 10Y SOFR+98a
