Filter by Categories

Something for your Espresso: Hide and seek with Biden

Biden is allegedly planning to leave Washington for the Memorial weekend, which underpins the probability of our base-case of a shutdown and a prolonged debt ceiling stand-off. The TGA is now BELOW typical shutdown levels.
2023-05-26

Good morning from Europe.

The debt ceiling stand-off continues, and we have admittedly been caught wrongfooted in our assessment of the rates positioning into the ultimate x-over date for the US Treasury. Front-end rates spiking 15bps based on a “base-effect” in initial claims is pretty telling of a uniform receiver positioning (bond longs) in USD rates.

If you pair that with a lack of clarity around the solution on the debt ceiling, front-end rates can go higher despite the pretty clear intention from the Fed to at least skip the hike in June. The x-over date is likely already early/mid next-week meaning that a (partial) shutdown of the US Federal Government moves closer and closer.

Yellen keeps referring to a x-over date first of June, while Goldman advocated for an ultimate x-over date 8-9th of June. Markets speak loudly. The x-over date is already next week.

Chart 1: Spread between June 1 and May 30 effective T-bill yield


 

 

 

Biden is allegedly planning to leave Washington for the Memorial weekend, which underpins the probability of our base-case of a shutdown and a prolonged debt ceiling stand-off. The TGA is now BELOW typical shutdown levels.

0 Comments

STENO RESEARCH IS JOINING REAL VISION

From July 2025, Steno Research is joining Real Vision to create the ultimate macro research product for you!

As a subscriber, this means the following:

Yearly subscriber: For legal reasons, we cannot transfer your pre-paid subscription directly. You need to register with Real Vision and then we’ll transfer your pre-paid subscription quickly afterwards. Simply go to https://www.realvision.com/free and sign up - and then we’ll take care of the rest! We will shut down service of Steno Research on July 31st, so be sure to make the transfer to keep receiving our content.

Already a RV subscriber?
Please check that you are using the same e-mail. If yes, you don't need to do anything. If not, please contact [email protected].

Monthly subscriber: Your current monthly subscription with Steno Research will end during July (31st at the latest). To continue accessing our research (and more), you’ll need to sign up for a Real Vision membership. Check out your options on: https://www.realvision.com/pricing

For Institutional Clients:
- Your access has been moved to our new institutional offering at NowcastIQ.com
- If you haven’t been moved already, please contact [email protected]