The Trump Whisperer
April 23, 2025
**************
–Is Bessent getting Trump to modify his most strident pronouncements? All of a sudden some softening on removing Powell and on China tariffs, leading to an unwind of Monday’s price action. The curve flattened, stocks jumped, gold reversed.
–In rates, the 2yr note rose 5 bps to 3.802% (old 2y) and the 30y fell 4 bps to 4.874%. On the SOFR strip, reds were -7.25 to 9681.125, greens -2.375 to 9658.375, blues -0.25 to 9633 and golds +1.125 to 9608.625. ESM5 settled +130 to 5314 and up another 109 this morning to 5423. GCM5 which had rallied $500/oz since April 9, from below 3000 to 3500, is now seeing profit-taking, printing 3340 this morning.
–Exit seller of 60k SFRM5 9575/9600cs at 9.5 to 9.25. Settled 9.25 ref M5 at 9590.5. Exit trade, giving up on a Powell ease.
–I’ve seen several articles like this one on BBG today: ‘Yale signals private equity may have peaked’. The music has stopped and now endowments need to unload private equity and credit. To who?
–Today’s news includes S&P PMIs and Beige Book, along with 5y auction. I believe the Chicago Fed is preparing this issue of the Beige Book. This release could have added significance in case the anecdotal evidence cites softening of conditions.
