US TSYS
- Treasuries have pared earlier losses, initially helped by stronger than expected German PMIs before some softer service readings elsewhere, most notably the UK. Treasuries outperform EGBs but underperform Gilts against that backdrop.
- Cash yields range from 0.5bp lower (2-3Y) to 0.2bp higher (20-30Y), pivoting beyond 10s.
- 2s10s is near unchanged at -44.3bps, consolidating the flattening over the past two days to its lowest since Apr 10/11 and last sustained for any period of time in mid-March.
- TYM4 at 109-03+ has reversed an earlier decline to 108-29+ but has remained within yesterday’s range throughout, on high volumes approaching 400k.
- Yesterday’s low of 108-28+ tested support at 108-29+ (20-day EMA) after which lies the key 108-15 (May 14 low), but this pullback appears corrective with resistance seen at the bull trigger of 109-31+ (May 16 high).
- Data: Weekly jobless claims (0830ET), Chicago Fed national activity Apr (0830ET), S&P Global US prelim PMIs May (0945ET), New home sales Apr (1000ET), KC Fed mfg May (1100ET)
- Fedspeak: Bostic in moderated Q&A (1500ET)
- Note/bonds issuance: US Tsy $16B 10Y TIPS auction re-open (1300ET)
- Bill issuance: US Tsy $80B each 4W, 8W bill auctions (1130ET)
2s10sSource: Bloomberg
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