JPY: EUR/JPY, USD/JPY Fades, Aided by Core Strength in EGBs
Jan-30 13:24
JPY drifts again to the best levels of the session - with new lows in USD/JPY narrowing the gap with key support and the bear trigger at 153.72 - marking not only the January low (during the DeepSeek sell-off), but also the 50% retracement for the Dec - Jan upleg.
- This move unrelated to the ECB decision specifically, but likely being aided by modest strength in core EGBs, with Bunds concurrently touching a new daily high.
- Importantly for EUR/JPY, the softness in the cross puts the long-standing pivot level at 159.73 back into play - a level likely to be tested on further JPY strength or a dovish turnout from Lagarde in ~20 minutes.
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STIR: Repo Reference Rates
Dec-31 13:03
- Secured Overnight Financing Rate (SOFR): 4.37% (-0.09), volume: $2.290T
- Broad General Collateral Rate (BGCR): 4.35% (-0.10), volume: $844B
- Tri-Party General Collateral Rate (TGCR): 4.35% (-0.10), volume: $798B
- (rate, volume levels reflect prior session)
US: Republicans Outnumber Democrats For First Time In Decades
Dec-31 12:47
New analysis of survey data from Gallup shows that there are now more Republican and Republican-leaning voters in the electorate than Democrats, for the first time in decades.
- Patrick Ruffini at Echelon Insights notes: “Historically, this is practically unheard of. Democrats have held a longstanding advantage in party identification that dates back to the New Deal, with Republicans drawing even on only a couple of occasions — the 1994 Republican Revolution and the immediate post-9/11 period.”
- Ruffini continues: “We are now entering a period where the roughly even party ID split reflects the highly competitive nature of national elections. All things being equal we should expect a 50-50 political environment to yield tied party ID, rather than a 3- or 4-point Democratic ID edge. Good Democratic years will mean more Democratic identifiers in the electorate, and good Republican years will mean more Republican identifiers.”
Figure 1: US Adult Party Identification and Leaning in Presidential Election Years
Source: Gallup
STIR: Large Sep'25/Dec'25 SOFR Skew Spread Package
Dec-31 12:45
Checking direction on skew package:
- 24,000 SFRU5 96.50/97.50 call spds ref 96.035 vs.
- 12,000 SFRZ5 95.50 puts ref 96.07
