Curve Bear Flattens On Monday

TYM3 deals at 114-31, -0-00+, in line with late NY levels.

• Cash tsys 11-23bps cheaper across the major benchmarks, the curve bear flattened.
• Tsys were pressured on Monday as gains in financial stocks were seen as fears of broader contagion in the sector eased.
• The KBW Index firmed as First Citizens agreed to buy SVB, and First Republic was buoyed by a Bloomberg report that US authorities are considering expanding an emergency lending facility that would give the lender more time to bolster its balance sheet.
• On the data front only the Dallas Fed Manf Activity crossed, printing softer than expected and still in contractionary territory.
• The latest 2-Year auction tailed by ~3bps, the lowest bid/cover ratio since November 2021 and weak in-direct take up was observed.
• Fed Governor Jefferson was on the wires this morning, he didn't comment directly on the outlook for Fed policy, noting that the bank is still learning the full effects of tightening.
• Retail Sales from Australia headline an otherwise thin Asia-Pac docket. Further out we have US Wholesale Inventories and Consumer Confidence. Fed VC Barr testifies before the Senate Banking Committee. We also have the latest 5-Year supply.