EUROPEAN INFLATION: Spain HICP Preview: Energy Base Effect To Push Headline Up
Sep-26 14:04
Spain (12% of EZ HICP in 2025) – 0800BST Monday September 29
- Consensus
- HICP: 3.1% Y/Y 2.7% prior.
- CPI: 3.1% Y/Y vs 2.7% prior (note only 4 estimates at typing)
- Core CPI: 2.5% Y/Y vs 2.4% prior (note only 4 estimates at typing).
- Analyst views:
- Morgan Stanley: “HICP rising to 2.9%Y (from 2.7%Y)”…”Our tracking of utility bills and fuel prices indicate a decline over the month, but they should remain mild compared to last year. Meanwhile, food inflation is likely to stay subdued”…..”Core HICP is expected to ease to 2.6%Y (from 2.7%Y)”.
- Goldman Sachs: “We expect Spanish headline inflation to increase to 2.9%yoy in September from 2.7%yoy in August, and core inflation to tick down to 2.6%yoy”…“ driven by a decline in both year-over-year core goods and services inflation”…“We expect a -17%mom nsa decrease in the package holidays component and a -14%mom nsa print in airfares, unwinding the summer strength, although airport strikes could exert some upward pressure on the component”….”we look for energy inflation to increase to 6.3%yoy from 3.2%yoy in August, driven by a base effect”
- Spanish final August HICP confirmed flash estimates at 2.70% Y/Y (vs 2.70% prior). Excluding energy and unprocessed foods, HICP continued its recent gradual upward trajectory in its third consecutive acceleration, at 2.42 Y/Y (highest rate since April, vs 2.34% prior) on the back of higher services inflation.
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ESM ISSUANCE: USD2bln WNG New 5-Year: Allocations Out
Aug-27 13:54
- USD2bln WNG of the new 5-year Sep-30 ESM-Bond
- Spread set earlier at SOFR MS+39 (SA 30/360) (guidance was SOFR+40 Area, IPT was MS+42 area, that was equiv. to CT5 + ~7.3bp)
- Books closed in excess of $13.3bn excl. JLM interest
- Issuer: European Stability Mechanism (TICKER: ESM)
- Issuer Ratings: Aaa (stable) (Moody's) / AAA (stable) (S&P) / AAA (stable) (Fitch)/ AAA (stable) (Scope)
- Format: Registered Notes, Reg S (NSS) / 144A
- Ranking: Senior, Unsecured, Unsubordinated
- Listing: Luxembourg
- Settlement: 4 September 2025 (T+6 (TARGET) / T+5 (NY))
- Maturity Date: 4 September 2030 (5Y)
- HR 101% vs CT5 (T 3 ⅞ 07/31/30 )
- ISIN: Reg S: XS3171756128 / 144A: US29881WAG78
- Coupon: Fixed, Semi-annual, 30/360, Following, Unadjusted
- Bookrunners: CACIB(DM/B&D) / DB / JPM
- Timing: Hedge deadline 15.30CET / 14.30UKT / 9.30EST
From market source and Bloomberg.
The transaction comes ahead of a USD3bln redemption for the ESM in September. That line also had a 5-year maturity initially.
EURUSD TECHS: Pierces Pivot Support At The 50-Day EMA
Aug-27 13:46
- RES 4: 1.1851 High Sep 10 2021
- RES 3: 1.1829 High Jul 01 and the bull trigger
- RES 2: 1.1789 High Jul 24
- RES 1: 1.1743 High Aug 22
- PRICE: 1.1586 @ 14:43 BST Aug 27
- SUP 1: 1.1574/1.1528 Intraday low / Low Aug 5
- SUP 2: 1.1392 Low Aug 1 and bear trigger
- SUP 3: 1.1373 Low Jun 10
- SUP 4: 1.1313 Low May 30
The trend set-up in EURUSD remains bullish and short-term weakness is for now considered corrective. However, the pair is trading lower today and has pierced key support at the 50-day EMA, at 1.1599. A clear break of the average would signal scope for a deeper retracement and potentially expose key M/T support at 1.1392, the Aug 1 low. For bulls, a resumption of gains would open key resistance and the bull trigger at 1.1829, the Jul 1 high.
US TSY FUTURES: BLOCK: Dec'25 2Y Sale
Aug-27 13:45
- -5,000 TUZ5 104-07, post time bid at 0937:01ET, 104-07.12 last -0.5)
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