US-EU: Trade Commissioner Speaks On Tariffs, Could Delay Retaliation In April
Mar-20 11:02
European Commissioner for Trade and Economic Security Maroš Šefčovič has been speaking at a hearing in the European Parliament regarding EU trade issues. The most headline-grabbing comment so far has been the implication that the EU could delay retaliatory tariffs on the US once the 2 April 'reciprocal tariffs' are imposed by the Trump administration.
- Šefčovič says "On April 2 we will have to assess the action taken by the US and keep a flexible approach so as to calibrate our response accordingly". Says that the original plan was for the first tranche of retaliatory tariffs (originally paused in 2018) to come in on 2 April, with a second tranche in the middle of the month. Claims now the Commission is considering just the second tranche mid-April.
- Asked about why there could be a delay, Šefčovič says that he wants more time for talks with the US, to ensure the tariffs will hold up legally, and to make sure there is not divergence among member states on the issue.
- Says that the Trump administration has highlighted five major areas it wants to rebalance its trade relations with the EU on: autos, timber, pharmaceuticals, aluminium and steel, and chips.
- It remains to be seen whether holding off on immediate retaliation can benefit the EU. The UK and Mexico's lack of retaliatory tariffs following initial US levies on steel and aluminium won plaudits from Commerce Sec. Howard Lutnick, but given the more acrimonious relations between Trump and the EU, the White House might maintain a hard line even if the EU delays its action.
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EGB SYNDICATION: Slovakia 15-year SlovGB mandate
Feb-18 10:51
"The Slovak Republic acting through the Ministry of Finance and represented by the Debt and Liquidity Management Agency (ARDAL), has mandated HSBC, J.P. Morgan, Slovenska sporitelna (Erste Group) and Tatra banka (RBI Group) as Joint Lead Managers and Joint Bookrunners for a new RegS Bearer EUR 15-year benchmark offering, with a maturity date on 27-Feb-2040, to be launched in the near future subject to market conditions." From market source
- The maturity is a little shorter than we had expected, we had looked for a new 12-year 2037 SlovGB to launch via syndication in February.
- Historically, Slovakia left its first syndication of the year until April but there has been a February syndication in each of the past two years.
- We pencil in a transaction size of E2.5-3.5bln.
BUNDS: BTP/Bund spread sees Tightening momentum
Feb-18 10:48
- BTP/Bund spread has cleared that initial 106.00bps level earlier, is now gaining some traction through 105.00bps, testing 104.00bps at present.
- Investors will be looking at the Psychological 100.00bps level for the next support, although better will be seen nearer the ~97.7bps area. the September 2021 low.
(Chart source: MNI/Bloomberg).
OUTLOOK: Price Signal Summary - EUROSTOXX50 Trend Needle Points North
Feb-18 10:48
- In the equity space, S&P E-Minis continue to climb and the contract maintains a firmer tone. Attention is on resistance at 6162.25, the Jan 24 high. Clearance of this level would expose the key resistance at 6178.75, the Dec 6 ‘24 high. A move above this hurdle would resume the primary uptrend.On the downside, initial key support has been defined at 6014.00, the Feb 10 low. A break would highlight a bearish development. First support lies at 6075.54, the 20-day EMA.
- The trend needle in EUROSTOXX 50 futures remains bullish. The move higher last week confirmed once again, a resumption of the uptrend that started on Nov 21 ‘24. Moving average studies are in a bull mode set-up too, highlighting a dominant uptrend. A major resistance at 5525.00, the March 2000 all-time high (cont), has been pierced. A clear break of it would highlight a key bullish technical breach. This would open 5552.90 2.764, a projection of the Dec 20 ‘24 - Jan 8 - 13 price swing. Support to watch is 5325.83, the 20-day EMA.
