MNI China Daily Summary: Thursday, April 22

MNI BRIEF: China To Quicken Resolving Local Debt Risks

RPT-MNI INTERVIEW: ECB's Wunsch Sees At Least Two Cuts By Dec

MNI BRIEF: Brazil CenBank Faces Greater Uncertainty - Campos

MNI: PBOC Conducts CNY2 Bln Via OMO Mon; Liquidity Unchanged

CHINA PBOC INJECTS CNY2 BILLION VIA 7-DAY REVERSE REPOS MON

EZ/UK T-Bill Calendar: 3/6-Month ATB Auction on Tuesday

EZ/UK Bond Supply Calendar: EU, FI Synds; IT, DE Auctions Tues

MNI: CANADA MAR INDUSTRIAL PRICES +0.8% MOM; EX-ENERGY +0.8%

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

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Hugely busy morning with Bunds already exceeding yday's range

BONDS
  • Hugely busy morning (although some of the moves have been overshadowed by the even bigger moves in FX!).
  • STIR futures are lower across the board this morning, following further reaction to yesterday's Fed dot plot (which was more hawkish than expected).
  • Bund futures have already exceeded both the high and low of yesterday's range: At the open they moved to a low of 140.58 but following the hit a low around 7:50 UK time before moving to a high of 142.02 on the day. The moves in USTs and gilts have been more muted in contrast.
  • There has been further flattening of Bund and gilt curves as the front-end sells off and the long-end moves higher.
  • Focus is now on the BOE. The decision will be announced at midday BST / 7:00ET. There is no press conference today as there is no MPR. The decision for Bank Rate is expected to be between 50bp and 75bp with markets pricing around 67bp but 20/23 analysts looking for a 50bp hike. MNI expects most MPC members will favour 50bp. However, the MNI Markets team also thinks there is a considerable chance that the start of active gilt sales is delayed until after the November MPC meeting given the huge uncertainty over the UK fiscal outlook and potential for a huge increase in gilt issuance from the DMO in coming months. See the MNI BOE Preview here.
  • TY1 futures are down -0-12+ today at 113-27 with 10y UST yields up 0.2bp at 3.534% and 2y yields up 4.2bp at 4.093%.
  • Bund futures are up 0.61 today at 141.81 with 10y Bund yields down -4.7bp at 1.842% and Schatz yields up 6.8bp at 1.812%.
  • Gilt futures are up 0.48 today at 104.06 with 10y yields down -2.6bp at 3.283% and 2y yields up 2.7bp at 3.392%.
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