RENEWABLES: Bulgaria Eyes 600MW of Hydro by 2026
Bulgaria's Ministry of Energy has signed contracts to repair and rehabilitate hydro units 1 and 3 of the Chaira hydropower plant, with over 600MW added to the grid by 2026, according to the country’s Energy Ministry.
- Minister Vladimir Malinov highlighted the success of the innovative repair approach used for hydro unit 2, which passed 72-hour tests in late 2024.
- By early 2026, three of the plant’s four units are expected to be operational, providing over 600MW of power
- Additionally, the country had launched a tender for the fourth unit in November last year, according to Balkan news.
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CROSS ASSET: Higher Yields help USDJPY above 151.00
- USDJPY has recovered back to the 151.00 handle, taking its cue from the falling Treasury Futures and in turn the Bund on this side of the Pond.
- Still worth noting that Tnotes still trade well within Yesterday's range, and TYH5 would need a test down to 110.28+ to test Friday's low.
- Regardless, next immediate resistance in USDJPY is at 151.20/151.75 50- and 20-day EMA values.
BONDS: Bonds Slip Again, Oil Ticks Higher
Core global FI fades again in recent trade, a rally to fresh session highs for crude oil a contributary factor, with headline flow limited.
STIR: A Little Over 80bp Of BoE Cuts Still Priced Through '25
No tangible reaction in SONIA markets as BoE’s Ramsden stays away from policy rate discussions in his latest address and subsequent Q&A.
- Recovery in the long end sees a modest dovish drift in pricing, although multi-week ranges are intact.
- SONIA futures last 0.25-7.0 higher.
- BoE-dated OIS last shows essentially 0bp of cuts for next week, 20.5bp of easing through February and ~29bp of cuts through March.
- Beyond that, 82.5bp of cuts are priced through Dec ’23, with that contract trading in a 55-87.5bp range since the November BoE decision.
- Markets haven’t been willing to price more than 3.5x 25bp of cuts through the end of next year during recent dovish moves, given sticky inflation and the BoE’s current preference for “gradual” cuts.
- You could argue that gradual cuts may equal one cut per quarter, leaving current market pricing a little hawkish vs. that baseline assumption.
- However, further data may be required to provide conviction in that idea and there is some worry surrounding global inflationary forces at present, helping limit dovish moves.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Dec-24 | 4.698 | -0.2 |
Feb-25 | 4.496 | -20.4 |
Mar-25 | 4.413 | -28.7 |
May-25 | 4.234 | -46.6 |
Jun-25 | 4.148 | -55.2 |
Aug-25 | 4.017 | -68.3 |
Sep-25 | 3.982 | -71.8 |
Nov-25 | 3.905 | -79.5 |
Dec-25 | 3.874 | -82.6 |
