Away From Best Levels

Core fixed income markets have drifted away from their early Asia highs, with a lack of headline catalysts observed. U.S. Tsy futures are now back to near enough unchanged levels vs. settlement across the curve, while the major cash benchmarks run somewhere in the region of 1-2bp cheaper on the session, with the front end leading the way lower. We haven’t seen much in the way of major headline flow to drive the move and e-minis are holding lower. Perhaps it is a case of some regional participants being a little less concerned re: the previously touted Pentagon worry surrounding the potential for Russia President Putin to make nuclear threats if the Ukraine conflict drags on. The start of the re-opening of factory production in China’s Shenzhen, in addition to subway services (at least across 5 districts that have achieved “COVID zero”) may also be feeding into price action.