30YY Tops 2.8352%

Tsy futures trade broadly weaker for the most part after Monday's close, curves bear steepening with 2s trading higher.

• Note, 2s10s currently +9.793 at 27.614 compares to inverted low of -9.561 a week ago Sunday as recession calls from dealers peaked. Trepidation over Tuesday's CPI data for March may be spurring some short end buying and rebound in curves off deeper inversion (recession flag).
• Re: chances of a recession in the U.S., GS strategists "found, when combining different segments of the yield curve a low probability of recession in the next 12 months is priced, but a 38% probability in 24 months".
• Highlight Block/cross: Massive 2Y vs. 5Y and 30Y ultra-bond steepener package at 1119:55ET
  • +49,000 TUM2 105-19.25, buy through 105-18.38 post-time offer, $2M DV01
  • -11,167 FVM2 113-01.75, sell-through 113-03.5 post-time bid, $540k DV01
  • -3,006 WNM2 165-00, sell-through 165-09 post-time bid, 910k DV01
• Meanwhile, Treasury futures still held weaker/near lows after $46B 3Y note auction (91282CEH0) trades through: 2.738% high yield vs. 2.740% WI; 2.48x bid-to-cover vs. 2.39x last month.
• Speaking of supply, FI markets also weighed down by rate lock hedging vs. Amazon 7pt debt issuance spanning 2Y -40Y.