Free Trial

Bear Steepening As Light Cheapening Holds In Asia

US TSYS

TYH3 deals at 114-25+, -0-04, a little off the base of its 0-06+ range on light volume of ~57k.

  • Cash Tsys bear steepened, with the major benchmarks 0.5-3.0bp cheaper into London.
  • The broader Asia-Pac reaction to the hawkish guidance that accompanied the latest ECB monetary policy decision applied moderate pressure to Tsys in early trading.
  • Continued concern surrounding the Chinese bond market, resulting in PBOC liquidity injections in recent days (via short- and medium-term facilities), may have helped to modestly extend the cheapening.
  • The space looked through a pullback in the USD as cross-asset inputs were mixed, with e-minis little changed and the DXY down ~0.2%.
  • Pre-NY we will see final Eurozone CPI readings and PMI data from Europe & the UK. Later on, San Francisco Fed President Daly will speak on inflation and the economy while NY Fed President Williams & Cleveland Fed President Mester will appear on BBG TV. We will also get flash Markit PMI data during NY hours.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.