Free Trial

Block Sale In TU Allows Early Bull Steepening To Unwind

US TSYS

U.S. Tsys have been a little more reluctant to turn bid (when compared to core European & UK peers) in lieu of the latest round of regional CPI data out of Germany.

  • A block sale of TU futures (-3.377K) will have caped the bid in the front end of the curve to some degree, with the broader space operating at or a little shy of best levels that came in lieu of the softer than expected NRW CPI print from Germany & downside surprise in French CPI.
  • Cash Tsys run 2.5-4.0bp richer, with intermediates now outperforming after the early round of bull steepening was broken, aided by the aforementioned TU block.
  • TYU3 sits +0-10+, 0-03 off the peak of its 0-14+ range.
  • FOMC-dated OIS shows 24bp of tightening priced for the July gathering, with 40bp of cuts then showing by year-end, in line with early London levels.
  • Short-end flow has been dominated by a 2.5K block steepener in the SFRZ3/Z5 spread.
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

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.