LNG: Second Arctic LNG 2 Tanker Looks to be Heading to China

Japan's former trade minister and a potential front-runner for the LDP leadership and PM role Saito stated that the BoJ must be cautious in raising interest rates. 

• Possibly more consequentially, Saito "urged Prime Minister Shigeru Ishiba to step down after last month's huge election loss, saying the ruling Liberal Democratic Party (LDP) must seek a third coalition partner under a new leader."
• "Saito pushed back against opposition calls to cut Japan's sales tax, saying that Japan must instead focus on growth policies aimed at creating a cycle of rising wages and prices." - Reuters

• There's way below average volumes at the start of the European session, Buxl is at times quoted as wide as 4 ticks wide.
• Looking at the UK Gilt, only a 12 ticks range in one hour of trading, since its Open.
• The Initial selling in Bond futures has been led by the long end 30yr part of the curve, the German long end supply equates to 19.2k Buxl, and given the much lower liquidity could be weighing.
• The Cash USTs is cheaper and steeper, and the US will also sell 10yr Notes later Today.

JP Morgan continues to recommend short GBPCHF "into what could be a dovish BoE on Thursday and given the constrained SNB and expected global growth slowdown in H2-25" in a note released yesterday evening:

• "The CHF reaction to US imposed tariffs on Switzerland shouldn’t be as bad as feared given product exemptions, company mitigations, potential for negotiations and other factors"
• "Corporate preparation for tariffs also limits the impact on CHF [...] there is some element of the market assuming ample room for these tariff rates to be negotiated down, which limits the initial currency response."
• "A risk scenario for CHF would be if global growth surprises to the upside and accelerates at the same time as Switzerland struggles with domestic growth woes from being singled out on tariffs, but our economists are still looking for a H2-25 global growth slowdown [...] The growth hit to Switzerland, if tariffs are sustained, would imply a significant headache for the SNB, which has been hesitant to cut into negative territory and is likely even more constrained on FX intervention if tariff negotiations are still in play"