Edging Higher Ahead Of Apr Inflation Report, 10-Year Supply

Treasuries have edged higher from overnight lows with a bit of bull flattening early Wednesday, in anticipation of key inflation data and 10-Yr supply.

• The 2-Yr yield is down 0.4bps at 0.1549%, 5-Yr is down 0.8bps at 0.7918%, 10-Yr is down 1.1bps at 1.6112%, and 30-Yr is down 1.7bps at 2.328%. Jun 10-Yr futures (TY) up 2.5/32 at 132-17 (L: 132-12.5 / H: 132-17.5)
• The main event of the day/week is the April CPI report at 0830ET - headline expected to slow to 0.2% M/M from +0.6% prior; but core seen keeping up the pressure at +0.3% from +0.3% prior. Both seen spiking Y/Y on base effects.
• It's the highest consensus for M/M core since the 1990s, so arguably a low bar is in place for a downside miss (more on this shortly, incl some sell-side previews).
• The other key event on the schedule is the $41B 10-Yr note auction at 1300ET (also $35B in 119-day bill supply at 1130ET). NY Fed buys ~$1.75B of 20-30Y Tsys.
• Fed speakers keep coming, but not all are econ/mon-pol focused subjects: 0900ET is prob the most important, w VC Clarida on the economic outlook (text and Q&A), 0905ET Boston's Rosengren on crypto; 1300ET Atlanta's Bostic in a webinar w CFR; 1330ET Philly's Harker on Higher Education.