Curve Flatter In Asia

TYM3 deals at 114-11, +0-05, a touch off the top of the 0-10+ range on volume of ~115k.

• Cash tsys sit 1bps cheaper to 2 bps richer across the major benchmarks. The curve has twist flattened pivoting on 3s.
• Tsys were marginally cheaper at the open as Asia-Pac participants digested yesterday's cheapening driven by the $30bn rescue package from First Republic and the associated Fed rate pricing adjustments in OIS markets.
• Losses extended as FOMC dated OIS saw the terminal rate tick higher and rate cut expectations for 2023 moderate.
• Tsys firmed off session lows as firmer regional equities boosted risk appetite and weighed on the USD.
• The bid marginally extended as news of a meeting of Japan's MOF, FSA and the BOJ which will in part cover the collapse of SVB.
• Fed dated OIS pricing now sees a terminal rate in May of ~5%, with ~75bps of cuts in 2023.
• In Europe today the final read of Eurozone CPI headlines an otherwise thin docket. Further out Industrial Production and UofMich consumer sentiment will cross.