US-CHINA: Trump Touts Trade Progress, Appears To Rule Out China Trip This Year

Bund futures have tracked USTs higher through the afternoon, with aforementioned support coming from tech-led US equity weakness and the WSJ reporting that Trump is considering firing Fed Governor Cook. That leaves futures +36 ticks at 129.43, close to session highs.

• A bearish threat remains present though, with initial resistance at the 20-day EMA (129.58) untested.
• German yields are 2.5-3.5bps lower across the curve, with a light flattening bias still intact. The 5s30s nonetheless is consolidating above the 100bp level.
• Tomorrow’s focus is the August flash PMIs, the first major piece of macro data this month.
• While a September ECB rate cut remains very unlikely (with expectations for a hold solidified after President Lagarde’s remarks this morning), STIR markets still lean in favour of one more 25bp cut this cycle. For such a move to gain support amongst the Governing Council, it will require further softness in inflation and growth data in the coming months.  

• US TSY 17W BILL AUCTION: HIGH 4.050%(ALLOT 76.08%)
• US TSY 17W BILL AUCTION: DEALERS TAKE 32.64% OF COMPETITIVES
• US TSY 17W BILL AUCTION: DIRECTS TAKE 6.42% OF COMPETITIVES
• US TSY 17W BILL AUCTION: INDIRECTS TAKE 60.94% OF COMPETITIVES
• US TSY 17W BILL AUCTION: BID/CVR 3.14

• US TSY 17W AUCTION: NON-COMP BIDS $455 MLN FROM $65.000 BLN TOTAL