PLN: Sideways Trade Continues, NBP Speak Cements Expectations Of May Cut
Apr-24 09:57
EUR/PLN trades flat at 4.2823 and remains in consolidation mode above its 200-DMA. A dip through that moving average (4.2632) would turn the focus to Apr 9 low of 4.2231. Conversely, bulls set their sights on Apr 16/Dec 25 highs of 4.3102/4.3114.
- In the latest round of NBP speak, Henryk Wnorowski, Ludwik Kotecki and Gabriela Maslowska said that the MPC could reduce interest rates in May. It was a dovish shift for Maslowska, who had been earlier communicating that monetary easing would only be possible towards the end of 2025. A cut at the upcoming meeting is priced in, but market participants are now trying to assess the odds of a 50bp reduction.
- Local data have had limited, if any, market impact this morning. The unemployment rate ticked lower to 5.3% in March, in line with expectations. Consumer confidence declined to -16.5 this month from -15.2 previously amid concerns about tariff wars.
- POLGBs have advanced across the curve before trimming gains. 10-year POLGB/Bund spread has been gradually tightening from a recent cyclical wide of 268bp and now sits at 277bp.
- The WIG Index has shed 0.4% today after hitting new record highs yesterday. The WIG20 Index operates 0.6% lower on the day.
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EGB SYNDICATION: France: 0.95% Jul-43 OATei tap: Spread set
Mar-25 09:46
- Spread set: 1.80% OATei RY +10bps (Guidance was + 12bps area)
- Size: EUR Benchmark (MNI expects E3-4bln)
- Books in excess of E37bln (inc E2.8bln JLM interest)
- Settlement: 1 April 2025 (T+5)
- ISIN: FR001400QCA1
- Bookrunners: BNPP / CITI(B&D and DM) / CACIB / JPM / MS / SG
- Timing: Books to close at 10:15GMT / 11:15CET, allocations and pricing later today
From market source / MNI colour
EQUITIES: Large EU Bank put spread
Mar-25 09:44
SX7E 155/150ps, bought for 0.30 in 20k.
EGBS: Bund Weakness Extends; Issuance and Equity Uptick Weighing
Mar-25 09:39
Bund futures have narrowed the gap to initial support at 127.88, with no discernible headline trigger noted for the latest round of weakness. Impending Bobl supply alongside heavy corporate issuance will likely be weighing on EGBs this morning, alongside a recovery in European equity futures. Bunds are -32 ticks at 127.95 at typing.
- The German curve has bear steepened, with 2-year yields up 2.5bps and 30-year yields 4bps higher.
- The March German IFO survey provided a more positive outlook than yesterday’s PMIs, with the expectations component stronger-than-expected at 87.7 (vs 87.3 cons, 85.6 prior).
- The Bund-led nature of the selloff sees 10-year EGB spreads biased tighter. 10-year DSL supply was digested smoothly.
- ECB’s Kazimir and Muller did not deviate materially from past remarks, the latter adopting a hawkish tone around the case for future rate cuts.
- ECB’s Holzmann, Vujcic and Nagel are scheduled to speak later today.
