US-CHINA: Trump Goes On Offensive Against China, Says Violates Trade Deal
MNI (London) - U.S. President Trump posts the following on Truth Social "Two weeks ago China was in grave economic danger! The very high Tariffs I set made it virtually impossible for China to TRADE into the United States marketplace which is, by far, number one in the World. We went, in effect, COLD TURKEY with China, and it was devastating for them. Many factories closed and there was, to put it mildly, “civil unrest.” I saw what was happening and didn’t like it, for them, not for us. I made a FAST DEAL with China in order to save them from what I thought was going to be a very bad situation, and I didn’t want to see that happen. Because of this deal, everything quickly stabilized and China got back to business as usual. Everybody was happy! That is the good news!!! The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!"
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US TSYS/SUPPLY: Quarterly Refunding: No Change In Sizes / Guidance Expected
For the Treasury Refunding Announcement at 0830ET, we will immediately post the most relevant developments (if any) on issuance guidance, anticipated Treasury bond auction sizes for the upcoming quarter, and anything else of note.
- Our preview is here. To recap on the main expectations:
- Treasury is not expected to adjust its guidance that it will keep nominal coupon auction sizes unchanged for “at least the next several quarters”, though there are some analysts that see elevated risks that this guidance could be softened to indicate increased openness to larger coupon sizes in future. This would be a Treasury-negative development as it would suggest risks that higher supply may be coming sooner than currently anticipated by consensus (which is currently somewhere between Q1 2026 and Q3 2026).
- Increases in nominal coupon sizes are not expected for the upcoming quarter. May is set to see $324B in nominal Treasury coupon sales, in addition to $18B in 10Y TIPS and $28B FRN for a total of $370B – a joint-post-Oct 2021 high.
- The refunding documents will be released here.
STIR: Repo Reference Rates
- Secured Overnight Financing Rate (SOFR): 4.36% (+0.00), volume: $2.623T
- Broad General Collateral Rate (BGCR): 4.35% (+0.00), volume: $1.059T
- Tri-Party General Collateral Rate (TCR): 4.35% (+0.00), volume: $1.018T
- (rate, volume levels reflect prior session)
EUROPEAN INFLATION: German inflation "surprise" in line with MNI tracking
- German HICP came in a tenth higher than consensus expected at 2.2%Y/Y.
- The national print also came in one tenth higher than consensus at 2.1%Y/Y - this is in line with the MNI tracking from the state estimates which indicated 2.1-2.2%Y/Y - so not a big surprise here.
