Curve Twist Steepens After Yields Set Fresh YtD Highs Across Curve Post-Fed

The hawkish reaction to the FOMC meeting saw TYZ3 through 109-00, with initial technical support breached in the process.

• A Fibonacci projection level was then broken with the contract bottoming at 108-16, before recovering to trade at 108-22 last, -0-17 on the day.
• Cash benchmarks are 1bp richer to 2bp cheaper as the curve twist steepens.
• Benchmark yields across the curve made fresh YtD highs in Asia-Pac hours.
• $177K DV01 of TU/UXY flattener blocks were seen in Asia.
• Terminal policy rate pricing sits around 5.74% (come January) on the FOMC-dated OIS strip, i.e. markets lean more into the idea of a hike than not post-Powell. Beyond there, ~35bp of cuts are showing through July.
• The raft of European & UK central bank decisions dominates pre-NY, with the BoE’s latest meeting deemed a close call after yesterday’s softer than expected CPI data. Markets and the consensus view of economists lean towards a hike.
• NY hours will see weekly jobless claims, the Philly Fed survey and existing home sales data hit.