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A Little Cheaper & Steeper In Asia

US TSYS

Tsys have cheapened a touch overnight, initially on the back of a BBG sources piece which suggested that the U.S. Tsy’s move to block Russia US$-debt payment via U.S. banks doesn’t necessarily mean default (after the initial headlines on the matter provided a very modest bid), although that is listed as one of the potential aims of the move, with other options available to Russia including a drain of US$ reserves held in Russia or spending freshly acquired revenue, per the source report.

  • Impetus from a hawkish RBA decision in Australia also played into the weakness ahead of European hours, with the curve steepening in both twist and bear manners during Asia-Pac dealing, as regional participants reacted to Monday’s NY session.
  • Also note that WTI & Brent futures are off best levels of the session, but still over a $1/bbl firmer on the day.
  • TYM2 is -0-03 at 122-00, 0-02+ off the base of its 0-12+ range, while cash Tsys are 1.0-2.5bp cheaper across the curve, bear flattening (As mentioned).
  • Flow was headlined by a screen lift of the of the EDK2 98.3750/.3125 put spreads (+10K over a few clips)
  • NY hours will be headlined by the latest ISM services survey, in addition to Fedspeak from Vice Chair Brainard, NY Fed President Williams & San Francisco Fed President Daly (’24 voter).
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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