US-RUSSIA: Trump "Strongly Considering" Russian Sanctions

• +2,000 WNH5 120-29, buy through 120-27 post time offer at 0910:43ET, DV01 $380,000. The 30Y Ultra contract trades 121-03 last (+1-12).

• Date $MM Issuer (Priced *, Launch #)
• 02/05 $1B #KFW 4% 2026 TAP SOFR+20
• 02/05 $Benchmark IBM 3Y +65a, 5Y +80a, 7Y +90a, 10Y +100a, 30Y +125a
• 02/05 $Benchmark PepsiCo 2Y +45a, 3Y +50a, 5Y +60a, 10Y +80a
• 02/05 $Benchmark UBS PerpNC5.5 7.5%a, PerpNC10 7.625%a
• 02/05 $Benchmark US Bancorp 6NC5 +100a, 11NC10 +125a
• 02/05 $Benchmark Citigroup PerpNC5 7.37%a
• 02/05 $Benchmark Citadel Finance 5Y +195a
• 02/05 $Benchmark Pacific Life 5Y +80a
• 02/05 $Benchmark IDA 10Y SOFR+61
• 02/05 $Benchmark IFC 4.5Y SOFR+36a
• 02/05 $Benchmark Minera Mexico 7Y +175a
• 02/05 $Benchmark Republic of Turkiye 7Y 7.5%a
• 02/05 $Benchmark Republic of Poland 5Y +85a, 10Y +115a

Lane's speech draws upon familiar themes from the ECB January press conference, with policy needing to track a "middle path" to "balance the risks of moving too slowly against the risks of moving too quickly". The familiar data-dependent and meeting-by-meeting approach was unsurprisingly repeated.

What is more notable is that another Executive Board member (after de Guindos earlier) has played down the relevance of the neutral rate in calibrating near-term policy.

• This comes ahead of the ECB staff paper on neutral rates this Friday, which is expected to contextualise the 1.75-2.25% range cited by President Lagarde ahead of the January press conference.

Excerpts from the speech:

• "In exiting a restrictive phase, much energy could be diverted towards creating a summary “restrictiveness” index. Any such index would have to incorporate at least nine factors"...."All of these factors enter our calibration of monetary policy (our assessment of the strength of monetary policy transmission has been highlighted as central to our reaction function) and cannot be summarised by a single indicator such as comparing the prevailing policy rate to a highly-uncertain estimate of the so-called neutral rate".
• "In terms of policy making, uncertainty about the level of the neutral rate and, more generally, about the strength of monetary transmission inescapably sits alongside uncertainty about the inflation outlook and uncertainty about the economic outlook".