CZECHIA: Coalition Parties Discuss Electoral Lists, Retail Sales Beat Forecasts
Feb-05 08:40
- Seznam Zpravy described the negotiations on election candidate lists between members of the Spolu coalition as "unexpectedly complicated and prolonged" as Prime Minister Fiala's ODS and Speaker Pekarova Adamova's TOP 09 battling over the top spots on each regional list. According to the report, KDU-CSL is less engaged in the conflict, knowing that its loyal supporters will tick its candidates even if they are lower on the lists.
- The CNB's monetary policy meeting tomorrow (see our preview here) will be preceded by the release of macroeconomic data, crucially the first flash CPI report. Barring any surprises, the central bank is expected to lower the repo rate by 25bp to 3.75%. HSBC, who are the only desk among those polled by Bloomberg that pencilled in a pause, still expect monetary easing to restart later this year.
- Czechia's ex-auto retail sales rose by 6.2% Y/Y in December, beating the consensus forecast of +4.1%, with the previous reading revised 0.1pp lower to +4.2%.
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GILTS: Under Pressure Alongside Peers
Jan-06 08:31
A sell off in wider core global FI markets weighs on gilts.
- Futures as low as 91.81.
- Bearish trend in the contract remains intact, next support seen at the Dec 19 low/bear trigger (91.64).
- Yields 2-3bp higher, curve steepens.
- 2s10s last 17.8bp, ~2bp off last week’s multi-month high.
- 5s30s ~77.1bp, 3-4bp below December’s multi-month high.
- SONIA futures under fresh pressure as gilts sell off, last flat to -4.0.
- SFIZ5 11.5 off its December low.
- BoE-dated OIS prices 55.5bp of cuts through year-end vs. 56-57bp early today.
- The BoE will sell GBP725mln of medium-term gilts from its APF this afternoon.
- Calendar ’25 DMO issuance gets underway tomorrow, via GBP2.25bln of 4.375% July 54 gilts.
CROSS ASSET: EUR extends gains post Spanish PMIs
Jan-06 08:21
- A good beat from Spain, but no real impact in Bund, with desks likely more focussed on the German CPIs.
- The EURUSD has extended higher, but the initial push higher was more a function of the Dollar, as its tests broader lows against the GBP, CZK, PLN, MXN, SGD, CHF, ZAR, SEK and NOK.
MNI: SPAIN DEC SRVCS PMI 57.3 (FCAST 54.1); NOV 53.1
Jan-06 08:15
- MNI: SPAIN DEC SRVCS PMI 57.3 (FCAST 54.1); NOV 53.1
