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Consolidation Of Significant Cheapening Ahead Of Payrolls

US TSYS
  • Cash Tsys sit 1-2bp cheaper across the curve, consolidating the sizeable sell-off over the past two days as mon pol ‘pivot’ expectations have been firmly reversed. 2YY are now within 6.5bps of early last week’s highs whilst 10YY are 17bps off the prior breach of 4%.
  • 2YY +1bps at 4.266%, 5YY +2.3bps at 4.09%, 10YY +1.5bps at 3.839%, and 30YY +0.8bps at 3.792%.
  • TYZ2 trades 5 ticks lower at 111-25 on moderating volumes as we move nearer to payrolls, having briefly cleared near-term support at 111-20+ (Sep 29 low) after which sits 110-19 (Sep 28 low).
  • Data: Payrolls for Sept dominates the session – preview here – followed by final wholesale inventories for Aug and then late on consumer credit for Aug.
  • Fedspeak: Williams (1000ET), Kashkari (1100ET) and Bostic (1200ET) with repeat appearances for the week.
  • No issuance

Source: Bloomberg

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