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Bear Flattening Ahead of April Surveys, McCarthy Debt Limit Deliberations

US TSYS
  • After little trend through Asia hours, cash Tsys continued Friday’s cheapening in the European session as they pushed through Friday’s lows across 2-10Y tenors although are since off fresh lows.
  • Amidst a light docket, added attention is likely on House Speaker McCarthy’s remarks expected to focus on the approaching debt limit (seen at 1000ET) plus earnings season with Charles Schwab today’s highlight ahead of a busy week for earnings (calendar here).
  • 2YY +3.8bp at 4.137%, 5YY +3.0bp at 3.635%, 10YY +2.1bp at 3.534% and 30YY +1.0bp at 3.745%.
  • TYM3 trades 4 ticks lower at 114-23+, clearing yesterday’s low and touching a session low of 114-20+ off somewhat subdued volumes of 200k. It extends last week’s bear cycle and opens support at the 50-day EMA of 114-14 after which lies the key 114-07 (Mar 29/30 lows) whilst to the upside sits resistance at 116-08 (Apr 12 high).
  • Data: Empire mfg index Apr (0830ET), NAHB housing Apr (1000ET), TIC flows Feb (1600ET)
  • Bill issuance: US Tsy $57B 13W, $48B 26W bill auction (1130ET)

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