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Curve Flattens On Wednesday

US TSYS

TYZ3 deals at 108-13+, +0-03, in line with late NY levels.

  • Cash tsys finished 1bp cheaper to 11bp richer across the major benchmarks, the curve twist flattening pivoting on 5s.
  • In a muted session data wise on Wednesday TY ticked higher through the session, technical resistance comes in at 108-25 (Nov 3 high).
  • Rate cut expectations for 2024 have marginally cooled; FOMC dated OIS now price ~65bps of cuts by Sep 24.
  • Cross asset wise; WTI fell ~2.5% amid continuing economic uncertainty and the USD firmed. US Equities were marginally firmer.
  • CPI and PPI from China provides the highlight in Asia today, further out we have Initial Jobless Claims and a number of Fedspeakers including Fed Chair Powell.

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