IRELAND: Risks From Potential US Tariffs - Corporate Tax Vulnerability (3/3)

SX7E (21st Feb) 145p, bought for 1.50 in 10k.

Since the turn of the year, ECB speakers have generally re-iterated that the case for further rate cuts is solid. ECB implied rates have nonetheless been dragged higher by USD and GBP counterparts, with OIS now pricing 89bps of cuts through year-end (down from around 115bps on December 31). 25bp cuts are still essentially fully priced through the January and March meetings, but implied odds of a larger 50bp move have been removed. 

• Since Jan 1, Stournaras, Villeroy, Lane, Rehn and Vujcic have supported the case for further policy easing, with the hawkish Holzmann unsurprisingly presenting a more cautious view.
• The recent surge in crude oil and natural gas prices may present a fresh upside risk to the inflation outlook, though Executive Board member Cipollone noted on Jan 9 that the “December projections already assume gas prices in 2025 will be 25% higher than the average for 2024”.
• Meanwhile, Lane and Vujcic commented that more progress is still needed on services inflation. For MNI’s recap of the December flash inflation data, see here.
• The ECB projects a consumption-led economic recovery to take hold in 2025, but US trade policy remains a key source of uncertainty. Markets and policymakers await US President-elect Trump’s inauguration on Jan 20 for further developments on that front.
• In the following, we provide a summary of ECB-speak during the first two weeks of 2025: 250114 - Weekly ECB Speak Wrap.pdf

• Date $MM Issuer (Priced *, Launch #)
• 01/14 $2.5B #BNG Bank 5Y SOFR+47
• 01/14 $2.5B #CADES 5Y SOFR+68, upsized from $2B
• 01/14 $3B KFW +5Y +40
• 01/14 $2B IFC 3Y SOFR+29
• 01/14 $2B CAF 5Y SOFR+82
• 01/14 $Benchmark Blackstone Private Cr Fund 7Y +190a
• 01/14 $Benchmark LifePoint Health 7NC3 
• 01/14 $Benchmark Adobe 3Y +50a, 5Y +60a, 10Y +80a
• 01/14 $Benchmark British Colombia 3Y SOFR+45
• 01/14 $Benchmark BFCM 5Y +120a, 5Y SOFR
• 01/14 $Benchmark Hyundai 3Y +100a