US: UKRAINE: Kellogg Had 'Positive' Discussions With Zelenskyy

Feb-21 13:56

US President Donald Trump's Special Envoy to Ukraine and Russia, Keith Kellogg, has issued a short statement on X claiming he had "positive" discussions with Ukrainian President Volodymyr Zelenskyy in Kyiv yesterday.  

  • Kellogg: "A long and intense day with the senior leadership of Ukraine. Extensive and positive discussions with [Zelenskyy], the embattled and courageous leader of a nation at war and his talented national security team."
  • Kellogg's tone is more notably more conciliatory than recent combative missives from Trump, Vice President JD Vance, and National Security Advisor Mike Waltz and comes amid reports Washington has submitted to Zelenskyy an "improved" draft of a minerals agreement that Zelenskyy rejected this week claiming it failed to deliver any security assurances for Kyiv.
  • Axios reports: “Sources on both sides say a deal is looking more likely,” adding: “A source said several of Zelensky's aides have encouraged him to sign the updated proposal — to avoid a further clash with Trump, and allow the U.S. president to justify U.S. support for Ukraine.”
  • The agreement covers potentially trillions of dollars of mineral wealth although much of the theorised resource is unproven and located in eastern parts of the countries occupied by Russia.
  • There are also questions about Kellogg's role in Trump's negotiations, appearing to operate as the 'carrot' of Trump's carrot-and-stick approach to talks with European partners and Ukraine. Trump has preferred to lean on his Middle East envoy Steve Witkoff to lead direct talks with Moscow. 

Historical bullets

MNI: US REDBOOK: JAN STORE SALES +4.2% V YR AGO MO

Jan-22 13:55
  • MNI: US REDBOOK: JAN STORE SALES +4.2% V YR AGO MO
  • US REDBOOK: STORE SALES +4.5% WK ENDED JAN 18 V YR AGO WK

STIR: SOFR Option Update, Early Call Adds

Jan-22 13:53
  • +5,000 SFRN5 94.87/95.25 put spds, 4.5 vs. 95.95/0.10%
  • +3,000 SFRM5 95.62/95.75 put spds, 3.75 vs. 95.895/0.10%
  • +5,000 0QN5 94.87/95.25 put spds, 4.5 vs. 95.99/0.10%
  • +7,000 SFRU5 96.06/96.31 call spds 7.25 ref 95.98
  • +4,000 0QM5 96.31/96.56 call spds vs. SFRM5 96.00/96.25 call spds 1.5 net flattener
  • +2,500 2QM5 97.00/SFRM5 96.56 call spd, 0.5 flattener

CANADA: CAD Assets Look Through Further Climb In Y/Y Cost Pressures

Jan-22 13:44
  • The industrial product and raw materials price report didn’t have a discernible impact on Canadian asset prices although it nevertheless shows a further acceleration in cost pressures in Y/Y terms.
  • BoC-dated OIS has ~21bp of cuts priced for next Wednesday’s BoC decision.
  • Not linked to the data, USDCAD has since stepped higher to session highs of 1.4370 on the back of a leg higher in the BBDXY index. It remains within particularly wide recent ranges (key support at 1.4261 from Jan 20 low vs resistance at 1.4516 from Jan 21 high).
  • Details: IPPI was admittedly softer than expected at 0.2% M/M (cons 0.6) after 0.6% M/M in Nov and 1.2% in Oct, although IPPI ex-petroleum has seen a more consistent recent trend with 0.4% M/M in Dec after 0.5% in Nov and 1.0% in Oct.
  • That leaves IPPI ex-petroleum inflation at 5.1% Y/Y (fastest since Nov 2022) whilst raw materials inflation stands at 9.1% Y/Y or 12.1% Y/Y ex-petroleum (fastest since May 2022). 
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