HALISTER1: ‘Squeeze Lower in Rates Is Likely to Continue,’ Citi Says

‘Squeeze Lower in Rates Is Likely to Continue,’ Citi Says

(Bloomberg) -- Fed “seems unclear about the next rate move, and consensus forecasts for rates are still too high,” Citi strategist Jabaz Mathai says in April 8 note.
  • “Equally important, lower growth in other economies that lowers sovereign rates elsewhere, results in an asset allocation into higher yielding U.S. Treasuries by non-U.S. investors”
  • Citi maintains “overall bullish view” of USTs and recommends long-duration bias expressed via long 5Y real yields and long call spread on 30Y
  • USTs “should outperform” in any selloff in bunds as occurred during 2Q 2015, however positioning “is more balanced now in bunds,” suggesting German 10Y yield will “move even lower, possibly into negative territory”
  • Meanwhile, prospect of increased policy accommodation by ECB and BOJ “will ensure that the Fed stays on hold for a while”
  • “It is difficult to see a sustained selloff in global rates in this environment”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Jabaz Mathai (Citigroup Inc)

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UUID: 7947283

HALISTER: Alcoa Looks to Finally Break Metal Shackles as Profit Sinks (1)

Alcoa Looks to Finally Break Metal Shackles as Profit Sinks (1)

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
AA US (Alcoa Inc)

People
Klaus Kleinfeld (Alcoa Inc)
Anthony Young (Macquarie Group Ltd)
Curt Woodworth (Credit Suisse Group AG)
David Lipschitz (CLSA Ltd)
Monica Orbe (Alcoa Inc)

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UUID: 7947283

HALISTER1: TD Recommends 5s30s Steepener Hedged With U.S.-German 10Y Spread

TD Recommends 5s30s Steepener Hedged With U.S.-German 10Y Spread

(Bloomberg) -- Steepening is likely based on “accommodative Fed policy via lower 1y1y rates, weaker S&P and higher BE inflation,” and 5s30s steepener carries positively by about 2.1bp over next 3 months, TD strategists led by Priya Misra say in note.
  • TD fair value model incorporating U.S. growth momentum, inflation expectations and risk premium, and global bond yields suggests 5s30s is 5bp too flat (with 12bp standard deviation of residual)
  • Because near-term risks to steepener include “ongoing decline in global yields,” they recommend hedging with long UST 10Y vs German 10Y, as spread is near historical wides
  • Risks also include safe-haven bid that flattens curve because market “has historically had a tough time being able to price in the next hike beyond 13 months except when the Fed was doing QE”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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UUID: 7947283

HALISTER: Volkswagen Agrees to Safeguard German Jobs to Quell Labor Unrest

Volkswagen Agrees to Safeguard German Jobs to Quell Labor Unrest

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
VOW GR (Volkswagen AG)
BMW GR (Bayerische Motoren Werke AG)

People
Bernd Osterloh (Volkswagen AG)
Herbert Diess (Volkswagen AG)
Matthias Mueller (Volkswagen AG)
Wolfgang Porsche (Porsche Automobil Holding SE)

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UUID: 7947283

HALISTER: Banks Eye Victory on Derivatives in EU Trading-Revamp Delay (1)

Banks Eye Victory on Derivatives in EU Trading-Revamp Delay (1)

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
GS US (Goldman Sachs Group Inc/The)
0629846D BB (European Commission)

People
David Logan (Roger Williams University)
Markus Ferber (European Parliament)

Topics
Market Structure

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UUID: 7947283

HALISTER: Aspen Hires From Swiss Re, Generali for Dubai Risk-Transfer Push

Aspen Hires From Swiss Re, Generali for Dubai Risk-Transfer Push

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
AHL US (Aspen Insurance Holdings Ltd)
G IM (Assicurazioni Generali SpA)
SREN VX (Swiss Re AG)
ENH US (Endurance Specialty Holdings Ltd)

People
Stephen Postlewhite (Aspen Re America Inc)

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UUID: 7947283

HALISTER1: Estonian Court Rules Bitcoin Trading Subject to Laundering Rules

Estonian Court Rules Bitcoin Trading Subject to Laundering Rules

(Bloomberg) -- Supreme Court’s administrative chamber upholds decisions by lower-level courts that anti-money laundering legislation applies to bitcoin trading, court says in website statement.
  • First- and second-level courts ruled anti-money laundering unit of Estonian police was justified to seek information from Otto Albert de Voogd, owner of bitcoin-trading website, about buyers and sellers, and about how AML rules were applied in offering bitcoin trading services
  • Supreme Court says de Voogd’s activities were “sufficiently tied to Estonia” to be subject to domestic legislation as he had physical office in capital, provided possibility to pay in cash at office and used Estonian among its website languages
  • NOTE: Feb. 2014, Estonian Police Say Bitcoin Traders Must Seek License From July
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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UUID: 7947283