EM CREDIT SUPPLY: TCELLT: new issue deal USD 5Y and Sust 7Y

Just a reminder that at 9:00GMT / 10:00CET we will receive the 2025 German issuance plan.

• We've seen estimates range from broadly E30bln reductions in capital markets issuance relative to 2024 through to similar levels to this year's E272.5bln.
• We haven't really seen any estimates for Bubill issuance - we would assume that the market is expecting a similar proportional change to that of capital markets issuance. This would imply a E20bln reduction to broadly flat at 2024's E163bln level (from E165bln initial target).
• Together we think this would imply a very broad E400-435bln broad total issuance volume target is expected.

AUD and NZD are still the worst performers in G10s, and market participants will be keeping a close eye at the current levels:

• AUDUSD is looking to challenge 0.6337, last Week's low, which was also the lowest print since November 2023.
  The 0.6300 figure will be the next area of interest.
• Similar risk for the Kiwi, now approaching Friday's low of 0.5754, its lowest print since November 2022.

In addition to the technical levels already identified in U.S. 10-Year Tsy yields (4.50% the next obvious upside target, last trading 4.415%) it is worth noting that the benchmark continues to operate within the medium-term downtrend channel drawn off the ’23 high (upper boundary at 4.46% today).

• Also worth highlighting that the 50-DMA crossed above the 200-DMA last week, forming a golden cross to signal the positive S/T momentum shift.
• If sustained, this would deepen the risk of a further upside move in yields, at least from a technical analysis standpoint.
• Tomorrow’s FOMC decision presents the key risk event this week.
• Analysts are unanimous in expecting a 25bp rate cut, but there are varying opinions on the path of rates ahead and the number of ’25 cuts that the Fed will signal in its Dot Plot.
• Click for our full preview.

Fig. 1: U.S. 10-Year Tsy Yield (%)

Source: MNI - MArket News/Bloomberg