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Bear Steeper But Still Rangebound Ahead Of Labor-Heavy Docket

US TSYS
  • Cash Tsys trade 1-4.5bp cheaper, bear steepening with 2s10s at -38.5bps pushing back towards the high end of yesterday’s range.
  • TYH4 prints a low of 112-05+ (-11) but remains above yesterday’s 111-28 which probed support at 111-31+ (20-day EMA) as the corrective pullback meets its first support level.
  • Treasuries have been happy to track gyrations in European peers around data releases with German regional CPI figures suggesting a national print close to consensus but stronger than expected final PMIs for the Eurozone. The moves come ahead of a US docket with various labor market updates ahead of Friday’s payrolls report (although with both initial and continuing jobless claims for periods after the December payrolls reference period).
  • Data: Challenger Job Cuts Dec (0730ET), ADP Dec (0815ET), Weekly jobless claims (0830ET), S&P Global US Services/Composite PMI Dec final (0945ET)
  • Bill issuance: US Tsy $80B 4W, $80B 8W Bill auctions (1130ET)

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