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Bely Lags Bid In Wings On Wednesday

US TSYS

TYH3 prints +0-02+ at 113-20+, marginally above late NY levels.

  • Cash Tsys were 2-4bp richer on Wednesday, with the belly lagging the wider (modest) bid.
  • A well-received round of 20-Year Tsy supply helped the long end to outperform intermediates in the later rounds of the NY session, after supply stopped through WI by over 1.0bp, while the cover ratio held above the recent average as dealer takedown slid further.
  • Steepening of the 2-/10-Year curve away from the deepest levels of inversion witnessed during the current cycle continued, as the spread moved to levels last observed in mid Nov.
  • The space recovered some poise after it was biased cheaper in Asia-Pac hours. A block buy in TY futures added to an early NY rally, with soft existing home sales data also helping, before a notably firmer than expected consumer confidence reading helped the space away from richest levels of the session.
  • There is a lack of tier 1 risk events slated for Asia-Pac hours. Further out, weekly jobless claims data, revised Q3 GDP readings and the Kansas City Fed m’fing index are due. We will also get 5-Year TIPS supply.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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