NATO: Rutte Confirms Agreement On 3.5%+1.5% GDP Def Spend Target
Speaking after the defence ministers' meeting, NATO Secretary General Mark Rutte confirms the widely anticipated agreement on new capability targets for the alliance. This consists of a 3.5% of GDP target for 'core defence spending' i.e. tanks, troops, ammo, planes, and another 1.5% of GDP equivalent on 'defence and security-related investments', i.e. key infrastructure, cybersecurity, border security, anti-terrorism.
- These combine to hit US President Donald Trump's demand of 5% of GDP going on defence. Rutte acknowledges this will require allies "to invest much more money."
- Adam Parsons at Sky News notes "Nations will have to show annual progress towards the 5% target to avoid a "hockey stick" graph."
- Backloading the increases in spending beyond the current electoral cycle, in order to avoid difficult, politically-unpopular decisions, has been seen as a potential threat to sustained increases in NATO defence spending.
- Asked whether the US should commit to 5% (US stood at 3.38% in 2024), Rutte says "This target is for all allies."
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US: CANADA: Trump-Carney White House Meeting Underway Shortly
US President Donald Trump is shortly due to meet with Canadian Prime Minister Mark Carney at the White House for a first meeting between the pair since Carney's Liberal Party retained government control at last month's federal elections. LIVESTREAM
- There will be significant focus on comments by the two leaders at a press spray before today's bilateral meeting and working lunch. Carney has positioned himself atop a group of countries firmly pushing back against Trump's hardline trade agenda. His political experience is likely to lead to a more restrained Oval Office meeting, with difficult negotiations pushed into a closed-door setting.
- The New York Times notes that Carney, "faces an unenviable balancing act. Canadians who took a chance on him will expect him to push back on Mr. Trump’s belittling and threatening rhetoric against Canada, as he promised he would."
- "But he will also need to avoid openly antagonizing Mr. Trump in their working luncheon or in front of journalists in the Oval Office photo opportunity that will follow."
PIPELINE: Corporate Bond Update: $750M Gold Fields 7Y Launched
A lot more corporate debt to issue today, not to mention the Tsy $42B 10Y note sale at 1300ET.
- Date $MM Issuer (Priced *, Launch #)
- 05/06 $750B #Gold Fields 7Y +175
- 05/06 $500M *Shinhan Bank 5Y +72
- 05/06 $500M Eaton WNG 5Y +90a
- 05/06 $Benchmark Bank of America 4NC3 +110a, 4NC3 SOFR+134, 11NC10 +140a
- 05/06 $Benchmark Starbucks Corp 3Y +100a, 5Y +115a, 10Y+135a
- 05/06 $Benchmark Standard Chartered 6NC5 +165a, 6NC5 SOFR
- 05/06 $Benchmark Cummins Inc +80a, +5Y +100a, 10Y +120a
- 05/06 $Benchmark Biogen +5Y +150a, 10Y +175a, 30Y +200a
- 05/06 $Benchmark American Homes 4 Rent 5Y +145a
- 05/06 $Benchmark Deutsche Bank 6NC5 fix/SOFR
- 05/06 $Benchmark Host Hotels & Resorts 7Y +195a
- 05/06 $Benchmark PNC 2NC1 +100a, 6NC5 +120a
- 05/06 $Benchmark Dominion Energy 3Y +110a
- 05/06 $Benchmark UBS 11NC10 +160a
OPTIONS: Expiries for May07 NY cut 1000ET (Source DTCC)
- EUR/USD: $1.1400(E763mln)
- USD/JPY: Y142.50($804mln), Y143.00($595mln), Y143.20($746mln), Y145.50-55($1.1bln), Y145.85-00($1.6bln)
- EUR/GBP: Gbp0.8555-68(E501mln)
- AUD/USD: $0.6400(A$676mln), $0.6600(A$717mln)
- USD/CAD: C$1.3750-65825mln), C$1.3775-80($961mln)
- USD/CNY: Cny7.2000($500mln)
