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All Eyes On November CPI

US TSYS

Renewed risk aversion propped up U.S. Tsys on Thursday, as participants reassessed risks posed by the Omicron coronavirus variant. Yields recovered from lows after a poor 30-Year Tsy auction but struggled to recoup earlier losses.

  • T-Notes have held a tight range since trading reopened in Tokyo, the contract last sits -0-03 at 130-09+. Cash U.S. Tsy yields are marginally mixed. Eurodollars run unch. to 2.0 ticks lower through the reds.
  • November CPI headlines the local docket today and will overshadow flash U. of Mich. Sentiment. Barring a large miss, the report is unlikely to change the broader view that the Fed will accelerate taper at next week's meeting to give themselves rate hike optionality next year.

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