BUNDS: UniCredit Think 2s10s Will Struggle To Flatten Below 60bp

• Size: E8bln (MNI expected E7-13bln)
• Spread set earlier at 3.15% Nov-31 BTP +13bps (guidance was +14bps area)
• Books closed in excess of E50bln (inc E5.55bln JLM interest)
• Hedge ratio: 108% vs 3.15% Nov-31 BTP
• Maturity: 15 July 2032
• ISIN: IT0005647265
• Coupon: Short first on 15 July 2025

30-year BTPei:

• Spread set earlier at 0.15% May-51 BTPei RY +36bps (guidance was +38bps area)
• Size: E3bln WNG
• Books closed in excess of E53bln (inc E3.1bln JLM interest)
• Hedge ratio: 119% vs 0.15% May-51 BTPei
• Maturity: 15 May 2056
• ISIN: IT0005647273
• Coupon: First full on 15 May

• Settlement: 25 April 2025 (T+5)
• Bookrunners: BBVA / BofA / GSBE SE / JPM (DM/B&D) / Natixis / Societe Generale
• Timing: Hedge deadline 13:00BST / 14:00CET

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• President Donald Trump will meet with a Japanese trade delegation at the White House today, offering the first look at how the administration will approach trade talks with allies.
• Trump launched a probe to determine if tariffs are required on critical minerals.
• A standoff between Washington and Beijing over opening trade talks continues. China is reportedly open to talks if Trump "shows respect". White House Press Secretary Karoline Leavitt said: “The ball is in China’s court… We don’t have to make a deal with them.”
• WSJ reports the Trump administration plans to use tariff negotiations to pressure trading partners to limit dealings with China.
• On Thursday, Italian PM Giorgia Meloni will become the first European leader to meet Trump since Liberation Day. Meloni has an ideological affinity with Trump, but her country lags on defence spending and operates a large trade surplus with the US.
• A dozen House Republicans warned they won’t back a reconciliation package that includes major cuts to Medicaid.
• The White House is launching a new phase towards dismantling government regulation.
• Up to 40,000 employees could leave the IRS through a combination of layoffs and buyouts.
• Trump hinted at another farm bailout package.
• The Trump administration is divided over the best way to prevent Iran from acquiring a nuclear weapon
• Poll of the Day: Many Americans expect deportations to lead to higher food prices.

Full Article: US DAILY BRIEF

Net Eurozone equity inflows were E62.2bln in February (NSA data), the largest single month inflow since December 2023 and versus a E9.2bln outflow in January. Eurozone investors reduced foreign equity holdings by E8.7bln, while foreign investors increased EZ equity holdings by E53.5bln (vs E11.5bln of acquisitions in January). This dynamic is consistent with investors rotating into outperforming European equities in Q1, a theme that may be exacerbated in the March and April data as the German fiscal announcement and US reciprocal tariff announcements are accounted for. 

• While country-level data is not available in the monthly release, this EZ equity inflow is likely to be mirrored by a US equity outflow amongst EZ investors.
• Elsewhere, there were E66.6bln of net debt outflows in February (vs E8.1bln in Jan), while other investment outflows were E42.2bln (vs a E45.7bln inflow in Jan). There was a significant fall in currency and deposit liabilities in February, particularly amongst MFIs excluding central banks.
• Zooming out to a 12mth rolling lookback, the financial account shows that current account surpluses (2.7% GDP) have continued to fund net direct investment (1.4% GDP vs 1.8% prior) and other investment (2.1% GDP vs 1.6% prior). Net portfolio inflows into the Eurozone were worth 0.4% GDP (vs 0.5% prior).
• Worth caveating that the BOP data is subject to revisions, which can alter recent trends month-to-month. As such, more attention should probably be given to the 12month rolling figures noted above.