CZECHIA: Parliament Speaker Pekarova Adamova Won't Run In Next Election
Feb-19 08:36
- Chamber of Deputies Speaker Marketa Pekarova Adamova announced that she would retire from politics and would not contest the upcoming parliamentary election this autumn due to health reasons. She is currently planning to stay on as TOP 09 leader until the party congress in November, even as she may not be able to fully participate in the election campaign. Pekarova Adamova was looking to run in this year's election from the top spot on the ruling Spolu coalition's Prague list. It is unclear who will get the prestigious spot (although informal speculation points to Defence Minister Jana Cernochova from ODS), but Pekarova Adamova confirmed to Seznam Zpravy that candidates from her party will lead Spolu's electoral lists in two out of 14 regions. This comes as Spolu prepares for a difficult battle against the resurgent ANO party led by ex-Prime Minister Andrej Babis.
- The cabinet holds its regular weekly meeting today.
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GERMAN DATA: German PPI Rises in December, ex-Energy Broadly Unchanged
Jan-20 08:31
German PPI rose to 0.8%% Y/Y in December, up from November's +0.1% Y/Y, but remains lower than consensus expectations of +1.1% Y/Y. Sequentially, PPI fell -0.1% M/M (vs +0.3% cons; +0.5% prior).
- Consistent with German CPI in December, energy deflation was less prominent than before, at -0.2% Y/Y (vs -2.4% November). This is the highest Y/Y rate since May 2023.
- That leaves ex-energy PPI broadly unchanged vs November, at 1.2% Y/Y - the rate has been hovering around that level for five months now.
- Looking at the non-energy categories, a deceleration in intermediate goods inflation stands out the most, at +0.1% Y/Y vs +0.4% in November. This comes as the trend of an acceleration in the category started to stall in September, and should, on the margin, be a positive sign regarding contained mid-term core goods CPI inflation in Germany.
- For further details see table.
GILTS: Flat Start, Syndication & Domestic Data Eyed This Week
Jan-20 08:24
Gilts little changed early today.
- Futures -12 at 91.55, trading in a 91.45-66 range.
- The structural trend condition in futures remains bearish, although the recent break above the 20-day EMA increases the threat to the overarching technical theme.
- Initial support and resistance at 90.68/91.96.
- Yields little changed to 1.5bp lower, front end outperforms.
- GBP STIRs still roughly in line with pre-gilt open levels, ~64bp of cuts priced through year-end.
- On the lookout for the syndicated tap of the 4.375% Jan-40 gilt. Bookrunners have indicated this will likely be tomorrow’s business, in line with our own expectation.
- Much of the weekend domestic headline flow centred on political posturing ahead of U.S. President Trump’s inauguration.
- That event dominates the macro calendar today.
- UK labour market data is due tomorrow, our full preview will be out later today, greater colour available in the pre-gilt open STIR bullet.
EURIBOR: Goldman Recommend ERM5/Z5 Flatteners
Jan-20 08:11
Goldman Sachs have recommended ERM5/Z5 flatteners, with an entry at -13.0, targeting a move to -30.0, with a stop set at -5.0.
- They think “the trimmed risk of 50bp cut odds is reasonable given the modest upside surprises to recent inflation data in Europe and expect terminal rate pricing in H225 to lead any further rally from here.”
