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China Faces Structural Inflation Risk: CBN


(M1) Attention is On The 50-DMA


(M1) Outlook Remains Bearish

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A modestly risk-off overnight session has seen Treasuries continue to edge higher, with the belly outperforming.

  • Jun 10-Yr futures (TY) up 4.5/32 at 131-26.5 (L: 131-18.5 / H: 131-30). High was hit early in the European session, where there was some attention on regulators' decisions on the safety of the AstraZeneca vaccine (EU authority holds presser at 1000ET).
  • The 2-Yr yield is down 0.4bps at 0.1527%, 5-Yr outperforming w yield down 1.9bps at 0.8528%, 10-Yr down 1.4bps at 1.642%, and 30-Yr down 1.2bps at 2.3106%.
  • Minutes from the March FOMC meeting out at 1400ET. Fed speakers today include Chicago's Evans (0900ET), Dallas's Kaplan (1100ET), Richmond's Barkin (1200ET), and SF's Daly (1300ET).
  • WSJ published an interview w Kaplan this morning in which he describes his thinking behind his 2022 hiking dot in the Summary of Economic Projections, and discussed his thoughts on pre-emptive vs reactive monetary policy and "the difference between being accommodative or even highly accommodative and keeping rates at zero".
  • Otherwise, a light calendar - Feb trade balance data at 0830ET and Feb consumer credit at 1500ET.
  • In supply, 1130ET sees auction of $35B of 119-day bills. NY Fed buys ~$6.025B of 4.5-7Y Tsys.