Core FI Soften As E-Minis Climb

Light selling pressure has hit core FI space in early trade, in spite of the weekend escalation in the NATO/Russia geopolitical tension over Ukraine and notable declines in major cryptocurrencies. All eyes this week are on the Fed, who are set to emerge from their monetary policy meeting and (hopefully) shed some light on the policy outlook on Wednesday.

• T-Notes have traded sideways thus far, with TYH2 last seen -0-07 at 128-03, oscillating within the confines of the prior day's range. Eurodollar futures run 0.5-4.0 ticks lower through the reds. Tsy yield curve has bear flattened as cash trading re-opened, with yields last 1.3-2.7bp higher. Worth noting that U.S. e-mini futures have operated in the green thus far. Flash Markit PMIs & 2-Year Tsy auction headline the local docket today.
• JGB futures have softened from the off, with JBH2 hitting a fresh session low of 150.96 (1 tick shy of last settlement) as we type. Cash JGB yield curve has steepened at the margin, with the preliminary results of Jibun Bank PMI survey shrugged off by the space.
• Cash ACGB yields last sit up to 1.5bp higher as the space shows some weakness. YM last -1.5 & XM -1.5, both rangebound with a slight bearish bias. Bills trade unch. to 2 ticks lower through the reds. The AOFM auctioned A$1.0bn of ACGB Sep '26, drawing bid/cover of 4.09x (prev. 6.08x).