EUROZONE T-BILL ISSUANCE: W/C April 21, 2025

• ESA: 63%.
• NQA: 53%.
• DOW: 69%.
• VGA: 62%.
• DAX: 43%.
• FTSE: 66%.

ERH6/M6 sold at 4.5 in 30k.

Industrial production picked up strongly in February after a softer January, as a jump in manufacturing activity offset weaker utilities production.

• Overall IP rose 0.7% M/M (nearly rounding up to 0.8%) vs 0.2% expected and 0.3% in January (rev down 0.2pp), with the seasonally-adjusted index hitting an all-time high and capacity utilization reaching an 8-month high 78.2%.
• The manufacturing index rose by 0.9%, the quickest pace in 12 months, to hit a 28-month high (the release highlighted an 8.5% M/M rise in motor vehicles/parts production as driving the increase). That's vs 0.3% expected, and came with an upward revision to January (0.1% from -0.1%).
• Utilities came in on the soft side at -2.5% M/M but that's after a 6.1% rise in January (which was attributed to heating during an unusually cold month), and activity in the segment is still up 8.7% Y/Y.
• Momentum in both overall industry and manufacturing has picked up noticeably: while the Y/Y rates were up 1.4% / 0.7% respectively, the 3M/3M annualized rates came in at 5.2% / 2.8% respectively (both the fastest in 33 months).
• As such the upside breakout in production since late 2024 continues, and corresponds with ISM manufacturing returning to above-50 territory for the first two months of 2025.
• That's the good news. Whether this is the result of front-running tariffs is a major question, though, particularly given that the auto sector - one of the most vulnerable to Canada/Mexico trade disruptions - was such a major driver in the month.
• We will continue to watch forward-looking indicators, including in regional Fed surveys, PMIs, and ISMs, to see whether the post-November election bounce can be sustained: early incoming evidence is that it won't be, given sharply deteriorated sentiment.