Block Sales Apply Light Pressure In Asia

Tsys have cheapened at the margin overnight, with the now familiar TY block sales (-1.7K & -2.0K) once again evident in Asia-Pac hours, helping the space lower.

• TYZ2 deals -0-06 at 110-23, 0-01 off the base of a tight 0-07 range, on limited volume of ~54K.
• Meanwhile, cash Tsys run 1-2bp cheaper across the curve, bear flattening.
• Minneapolis Fed President Kashkari (’23 voter) underscored the need for continued tightening during the NY-Asia crossover, as he suggested that there would be no pause in tightening until there is compelling evidence that core inflation has peaked.
• The first notable risk event of Wednesday trade comes in the form of UK CPI data.
• Further out, housing starts and building permits data headline the NY data docket, with Fedspeak from Bullard, Evans & Kashkari, as well as the release of the Fed’s Beige Book, also due. On the supply side, we will see the latest 20-Year Tsy auction.