BUNDS: A steadier Overnight session,US 10yr Yield trades around 4.50%
Apr-14 06:14
- A calmer overnight session for Bund compared to the multiple Volatile sessions seen of late, the contract trades in the red but remains well within Friday's wide 150 ticks traded range.
- Small resistance is at today's high of 130.75, and first support comes at 129.92, Friday's low.
- US Tnotes saw the Yield jumped towards 4.60%, printed a 4.5864% high on Friday, and despite the recovery in Futures, the Yield is still close to the 4.50% mark going into the European session.
- It is a lighter Week on the Data front, main focus for Europe will be on the ECB Thursday, expected to cut rates by 25bps given the Tariff Risks.
- Today only sees, US NY Fed 1yr Inflation Expectations.
- SPEAKERS: Fed Waller, Harker.
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FED: March Economic Projections: Higher Inflation, Weaker Growth, Same Rates
Mar-14 21:28
The MNI Markets Team’s expectations for the updated Economic Projections in the March SEP are below.
- The unemployment rate is likely to rise slightly for 2025 alongside a downgrade in GDP growth, while the 2025 core and headline PCE inflation projections are set to rise again. Changes to later years will likely be limited, however.
- More detail on the shift in Fed funds rate medians is in our meeting preview - we will add more color next week.
FED: Market Pricing Nearly 3 2025 Cuts As Conditions Tighten
Mar-14 21:25
Amid rising government policy uncertainty, sentiment among businesses and consumers has fallen sharply since the start of the year, while equities and the dollar have reversed their post-election rise. Overall, financial conditions have tightened, even if stress is not yet mounting, e.g. no major widening of credit spreads (the accompanying chart shows the Fed’s financial conditions impulse index but only through January).
- Combined with growth fears, this has affected expectations for the Fed’s rate path, with around 18bp more cuts expected in 2025 compared with what was seen after the January FOMC. 65bp of cuts are priced for the year as a whole. 2025 cut pricing reached 71bp before the February inflation data and 76bp before the February payrolls report.
- A rate cut is seen with near zero probability for March’s meeting, but the first full cut is just about priced for June, with a second nearly priced by September.
- Chair Powell has no reason to endorse or refute these expectations – he’s likely to be happy with a press conference that ends with little discernable change in pricing.
CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
Mar-14 21:17
- CANADA'S CARNEY ANNOUNCES ELIMINATION OF THE CONSUMER CARBON TAX
