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A Late NY Bid

US TSYS

TYZ2 deals a touch shy of its late NY peak at the re-open.

  • This comes after Tsys richened to fresh session highs into the NY close, aided by continued liquidity issues and industry contagion worry surrounding one of the major cryptocurrency exchanges and comments from Chicago Fed President Evans (who retires in early ’23), who pointed to the benefits of slowing the pace of rate hikes “as soon as we can.”
  • A steepening impulse was maintained in lieu of a poorly received round of 10-Year Tsy supply, even as Tsys rallied to best levels of the day, with the major benchmarks running flat to ~7bp richer across the curve at the close.
  • A bid in European bonds had helped support the space pre-auction.
  • In terms of auction specifics, there was a particularly wide tail of over 3bp, while the cover ratio softened, moving further below its recent average, as dealer takedown nudged further above its own recent average.
  • An address from Minneapolis Fed President Kashkari headlines the Asia-Pac docket. Further out, the latest CPI print presents the key risk event on Thursday (see our full preview of that release here). CPI data will be supplemented by weekly claims data, 30-Year Tsy supply and a deluge of Fedspeak.
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TYZ2 deals a touch shy of its late NY peak at the re-open.

  • This comes after Tsys richened to fresh session highs into the NY close, aided by continued liquidity issues and industry contagion worry surrounding one of the major cryptocurrency exchanges and comments from Chicago Fed President Evans (who retires in early ’23), who pointed to the benefits of slowing the pace of rate hikes “as soon as we can.”
  • A steepening impulse was maintained in lieu of a poorly received round of 10-Year Tsy supply, even as Tsys rallied to best levels of the day, with the major benchmarks running flat to ~7bp richer across the curve at the close.
  • A bid in European bonds had helped support the space pre-auction.
  • In terms of auction specifics, there was a particularly wide tail of over 3bp, while the cover ratio softened, moving further below its recent average, as dealer takedown nudged further above its own recent average.
  • An address from Minneapolis Fed President Kashkari headlines the Asia-Pac docket. Further out, the latest CPI print presents the key risk event on Thursday (see our full preview of that release here). CPI data will be supplemented by weekly claims data, 30-Year Tsy supply and a deluge of Fedspeak.