EGB SYNDICATION: Slovenia New 10-year: Mandate

• EURUSD is currently testing above key resistance and the bull trigger at 1.1656 (Nov 13 high). Prediction market odds for a Russia/Ukraine ceasefire by the end of '26 remain around 50%, however, the latest headlines from the Kremlin may be providing some more tepid optimism relating to the peace talks.
• While the Kremlin acknowledged that some things were accepted and others rejected as unacceptable, this is part of a normal working process. The kremlin adds it would be wrong to say that Putin rejected the US plan on Ukraine, they said it was a first exchange of opinions.
• Overall, the risk backdrop remains stable Wednesday, allowing the major indices and crypto markets to edge higher and provide a negative tilt to the US dollar. The greenback tone was also set late last night as President Trump’s nod towards Kevin Hassett potentially becoming the next Fed Chair confirms the dovish bias to market Fed pricing for 2026.
• Of additional importance for EURUSD, the week’s advance cancelled a doji reversal signal from last Thursday, and above 1.1656, the immediate focus turns to 1.1694, a retracement level and 1.1728, the Oct 17 high.

Core global FI markets have eased from early session highs, with firmer-than-expected services PMI data out of Europe & the UK noted.

• Bund futures +4 at 128.57. Initial support and resistance located at 128.12 & 128.72.
• German yields little changed to 1bp higher, curve marginally steeper.
• The 10-Year BTP/Bund spread threatens to break below 70bp, a level that has not been closed below since January ’10. Firmer than-expected Italian PMI data has factored into BTP outperformance.
• OATs hold yesterday’s widening.
• Gilt futures briefly rallied more than 60 ticks from yesterday’s low, topping out at 91.50 before fading back to ~91.30 last, still ~15 ticks higher on the day.
• Bulls remain in technical control, with our technical analyst deeming the recent pullback to be corrective. Initial support and resistance in the contract remain located at 90.87 & 91.93, respectively.
• Yields 1bp higher to 1bp lower, front end underperformed into the GBP4.75bln 4.00% May-29 gilt auction, which ultimately provided average results.
• SONIA futures within 1bp of yesterday’s closing levels, BoE-dated OIS still pricing over 80% odds of a rate cut later this month.
• Comments from ECB’s Lagarde, Lane & Dolenc are due today, with BoE’s Mann also due to speak (albeit with a focus on reserve currencies as opposed to outright monetary policy matters).
• U.S. ADP employment and ISM services data headline the macro calendar today.

• E1.115bln of the 3.20% Jan-26 BTP Short Term (ISIN: IT0005584302) at 100.120
• E1.020bln of the 4.50% Mar-26 BTP (ISIN: IT0004644735) at 100.577
• E1.112bln of the 3.80% Apr-26 BTP (ISIN: IT0005538597) at 100.585
• E1.015bln of the 3.10% Aug-26 BTP Short Term (ISIN: IT0005607269) at 100.681
• E1.264bln of the 3.85% Sep-26 BTP (ISIN: IT0005556011) at 101.305
• E0.720bln of the 0.55% May-26 BTP Italia (ISIN: IT0005332835) at 99.549
• E0.754bln of the 0.50% Apr-26 CCTeu (ISIN: IT0005428617) at 100.222