ITALY AUCTION PREVIEW: BTP Short Term Auction At 1000BST
Italy will hold a BTP Short Term auction this morning, with the on-the-run 2.55% Feb-27 BTP Short Te...
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STIR: Implied Probability Of An April ECB Cut Has Inched Higher In Recent Weeks
The ESTR OIS implied probability of a 25bp ECB cut on April 17 has moved from less than 50% two weeks ago to around 65% at typing. We noted in our latest weekly wrap that the balance of last week’s ECB-speak veered in a dovish direction, with several Governing Council members appearing open to the idea of an April cut. See here for more.
- However, incoming data (particularly the March flash inflation figures and the Q1 Bank Lending Survey) remain key alongside the extent of US tariff announcements from April 2.
- OIS price 51bps of easing through year-end, ~1.5bps more hawkish than yesterday’s close.
- Euribor futures are a touch softer through the blues versus yesterday's settlement, weakening alongside Bunds.
- Today’s regional calendar is headlined by the German March IFO survey. The expectations component may be supported by the recent fiscal announcements, but the Business Climate and Current Assessment components will provide a better gauge of sentiment in the immediate term.
- ECBspeak is due from Kazimir, Muller, Holzmann, Vujcic and Nagel. Yesterday evening, Escriva noted that growth risks are tilted to the downside but inflation risks are unclear, given the “extreme” uncertainty the economy is facing.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Apr-25 | 2.255 | -16.3 |
| Jun-25 | 2.085 | -33.3 |
| Jul-25 | 2.039 | -37.9 |
| Sep-25 | 1.958 | -46.0 |
| Oct-25 | 1.944 | -47.4 |
| Dec-25 | 1.911 | -50.7 |
| Feb-26 | 1.909 | -50.9 |
| Mar-26 | 1.913 | -50.5 |
| Source: MNI/Bloomberg. | ||
USDCAD TECHS: MA Studies Remain In A Bull-Mode Position
- RES 4: 1.4793 High Feb 3 and key resistance
- RES 3: 1.4700 Round number resistance
- RES 2: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 1: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- PRICE: 1.4322 @ 08:01 GMT Mar 25
- SUP 1: 1.4242 Low Mar 6 and a key near-term support
- SUP 2: 1.4151/4107 Low Feb 14 / 50.0% of Sep 25 - Feb 3 bull run
- SUP 3: 1.4011 Low Dec 5 ‘24
- SUP 4: 1.3944 61.8% retracement of the Sep 25 ‘24 - Feb 3 bull cycle
USDCAD continues to trade closer to its recent lows. The bull cycle that started Feb 14 is intact and moving average studies remain in a bull-mode position, highlighting a dominant uptrend. A near-term key support to watch lies at 1.4242, the Mar 6 low. Clearance of this level would undermine the bull theme and instead highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. The bull trigger is 1.4543, the Mar 4 high.
SONIA: Call fly buyer
SFIZ5 96.00/96.20/96.30 broken call fly, bought for 4.75in 2.5k.
