US NATGAS: Northeast EOD – Looks Bearish 

2025: The 2025 end-year rate median is likely to remain unchanged in March from December’s projection of 3.9%, representing two 25bp cuts this year. Our expectation for the dots is below.

• The 10 participants (of 19 total on the FOMC) who pencilled in that rate in December probably included the leadership of the Committee including Chair Powell, which usually holds sway over the median.
• We could see a drift higher in the distribution for multiple reasons. Firstly, the upper end of the distribution is likely to be cemented, with probably 3 or 4 participants eyeing a year-long hold, perhaps joined by 1 or 2 looking for just one cut this year. (One intrigue will be if one of the hawks pencils in a rate hike, though that looks unlikely and hasn’t been mentioned as a base case by any participant.)
• Secondly, the bottom end of the distribution will drift up: the two bottom dots at 3.4% (100bp of cuts) and 3.1% (125bp of cuts) will probably move to 3.6% (75bp of cuts), given what we’ve heard from FOMC participants so far this year (even Gov Waller, a dove, notes potential for just two or perhaps three cuts). One or two of December’s three 3x cutters could drift higher to the 2x cut slot.
• That will leave a still-solid 12-14 participants looking for 2-3 cuts this year. 

• Treasuries look to finish higher Tuesday, off late session highs, curves mixed after rebounding off Monday's lows earlier.
• Treasury futures had retreated/extended lows after this morning's data: Housing starts were far stronger than expected in February at 1,501k (1,385k expected, 1,350k prior after -16k revision), effectively reversing the sharp drop in January that may have been weather-impacted, following the jump in December to 1,526k. Building permits, which have been much less volatile of late, came in closer to the mark at 1,456k (1,453k expected, 1,473k prior unrevised).
• Import price inflation was stronger than expected in February, printing 0.4% M/M (0.0% consensus, 0.4% prior after +0.1pp rev), while ex-petroleum import inflation also exceeded expectations at 0.4% (0.2% consensus, 0.1% prior unrev).
• Industrial production picked up strongly in February after a softer January, as a jump in manufacturing activity offset weaker utilities production.
• The Mar'25 10Y currently trades 110-24.5 (+5) vs. 110-14 low/110-29 high - still inside initial technical levels: resistance above at 111-25 (Mar 11 high), support below at 110-12.5/110-00 (Low Mar 6 & 13 / High Feb 7). Tsy 10Y yield 4.2793% last, curves off yesterday's lows: 2s10s -1.092 at 23.929, 5s30s +0.495 at 50.597.
• Focus turns to Wednesday's FOMC policy annc. Projected rate cuts through mid-2025 steady to softer vs. morning levels (*) as follows: Mar'25 steady at -.2bp, May'25 at -5.4bp ( -6bp), Jun'25 at -18.2bp (-19.7bp), Jul'25 at -26.7bp (-28.7bp).

US President Donald Trump's approval rating has continued to decline amid uncertainty over his tariff agenda and a stock market correction, according to Silver Bulletin.

• Nate Silver notes: "Trump has a -5 net approval rating in the latest AtlasIntel poll — 47 percent of Americans approve of the job he’s doing and 52 percent disapprove. The previous Atlas poll had Trump’s approval almost dead even: 50.3 percent approval vs. 49.7 percent disapproval. It’s best not to make a big deal about individual polls. But post-2024, Atlas ranks first in the Silver Bulletin pollster ratings. So their results are weighted fairly heavily in our average. This new release brought Trump’s net approval down by 0.3 points."
• NBC News noted yesterday: "Trump’s approval rating also equals his best-ever mark as president (47%), though again, a majority (51%) disapproves of his performance."
• Should Trump's approval rating continue to trend down, the White House may move to moderate some of Trump's more hardline trade positions in order to bolster perceptions of his handling of the economy. 

Figure 1: President Donald Trump's Approval Rating

Source: Silver Bulletin