Free Trial

Bull Flattening Retracement On Omicron Restrictions

US TSYS
  • Cash Tsys have bull flattened this morning on fears of Omicron-related restrictions, partially retracing yesterday’s sell-off into the afternoon after headlines of Pfizer neutralizing Omicron with three doses.
  • USTs have lagged the moves seen in Europe this morning in 10Y space, down -2.7bps compared to -3.4bps for Bunds and -4.8bps for Gilts.
  • 2Y yields are -0.6bps at 0.676%, 5Y -2.3bps at 1.252%, 10Y -2.6bps at 1.496% and 30Y at -3.0bps at 1.863%.
  • TYH2 futures have slowly rallied off the weekly low, currently up five ticks on the day at session highs of 130-11+. This takes them above the 20-day EMA of 130-09, reinstating a bullish outlook with 131-16 (Dec 3 high) seen as the next resistance level and a bull trigger.
  • A quiet day for data with weekly jobless claims and household net worth for Q3 the pick. The focus is instead on tomorrow’s CPI report ahead of the FOMC decision on Wed.
  • NY Fed buy-ops: Tsy 0Y-2.25Y, appr $10.875B (1030ET) followed by Tsy 10Y-22.5Y, appr $1.425B (1120ET).
  • Last Tsy issuance of the week today with the $22B 30Y Bond R/O auction (1300ET).

To read the full story

Close

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.