US-RUSSIA: Republican Leader Thune Says Senate Ready To Act On Russia Sanctions
Senate Majority Leader John Thune (R-SD) told Fox News that the Senate is "prepared to move on the Russia sanctions bill if required", after President Donald Trump threatened new penalties on Russia within 10 days, if Moscow fails to take steps towards securing a ceasefire with Ukraine.
- Trump told reporters: “I don’t know if it’s going to affect Russia, because [Russian President Vladimir Putin] wants to [...] keep the war going. But we’re going to put on tariffs and the various things you put on. It may or may not affect them. But it could.”
- With the House on recess until September 2 and the Senate expected to follow on Friday, Trump is likely to pursue any potential new sanctions or tariffs via executive action.
- The most powerful tool available to Trump is secondary tariffs on buyers of Russian oil and gas products, this would fall heavily on China, India, Turkey, and Brazil. However, considering challenging trade talks with China, India, and Brazil, Trump may choose to avoid measures that could undermine negotiations.
- The baseline scenario is that Trump's actions, if they come, would target Russian O&G, but fall below the punitive level in Senator Lindsay Graham's (R-SC) 'Sanctioning Russia Act'.
- Trump's Truth Social post earlier, threatening tariffs on India, specifically flagged New Delhi's purchase of Russian oil and military hardware, suggesting that one possible option could target India, while providing a temporary carveout for China during the tariff and export control truce.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
NOK: Underperforming G-10 As Rate Differentials Narrow
The Norwegian krone underperforms the G10 basket today, with EURNOK up 0.55%. Today's rally sees the cross narrow the gap to resistance at 11.9093 (61.8% retracement of the April-June selloff). Clearance of this level would expose the 12.0000 handle. Although 12.0000 was cleared during the post-Liberation Day volatility in April, it has provided soft psychological resistance to the cross on several occasions since 2023.
- Domestic news has been limited today, but 2-year NOK swap rates are still down ~3.5bps (2-year EUR swap rates are little changed, while SEK rates are down 1.5bps).
- JP Morgan remain bullish on NOK "due to growth, fiscal space, valuations, and its appeal for carry-efficient dollar shorts". They forecast EURNOK at 11.40 in Q4 2025 and 11.10 in Q2 2026.
- Norges Bank will sell NOK276mln of foreign exchange per day in its July transactions (i.e. NOK buying). That’s the most NOK buying since November 2021, but is still likely too small to have a material FX impact.
- This week’s Norwegian calendar only features tomorrow's manufacturing PMI. However, it can be a volatile release and thus is not usually a market mover.
US-EU: Sefcovic To Travel To US & Continue Trade Taks
European Trade and Economic Security Commissioner Maros Sefcovic has confirmed that he will travel to Washington, D.C., on 1 July for trade talks with US officials as Brussels seeks to avoid the imposition of substantial reciprocal tariffs on 9 July. It is widely expected that if any agreement can be reached by the deadline, it will not be a fully-fledged trade deal but a much looser framework of an agreement, in a similar vein (although with different details) of that reached between the US and UK that came into force today.
- The last-minute cave-in from Canada on its Digital Services Tax, that would have hit US tech giants, in order to continue trade talks could see the White House seek to exert similar pressure on Brussels. However, the EU's DMA (Digital Markets Act) and the DSA (Digital Services Act) are different in nature. Rather than applying a flat tax an revenue like the Canadian legislation, the EU laws enable the Union to fine firms for non-compliance with regulations on anticompetitive behaviour of lack of moderation on their platforms.
- EU spox said earlier "The legislation will not be changed. The DMA and the DSA are not on the table in the trade negotiations with the US"
- In any case, the imposition of the 10% 'baseline' tariffs looks set to remain in place no matter the eventual deal between Washington and Brussels.
BUNDS: Large selling flows goes through in Bund
- In terms of pure flows: This is the second best traded 5 minutes period in Bund, around 40k went through during the Regional German CPIs releasde this Morning.
- Bund has just seen circa 43k lots trading from that fall at 130.27, down to 130.07.
- Given the contract has found support at the 2.60% resistance in Yield, this looks to be order related.
- US Treasuries have been unmoved and so have Equities, so suggest no new news.
