Edging Lower, With Georgia Elections Eyed

Treasuries have edged lower with bear steepening overnight on modest volumes, with election risk looming large and a fairly limited slate otherwise Tuesday.

• The 2-Yr yield is up 0.2bps at 0.1151%, 5-Yr is up 1.1bps at 0.3607%, 10-Yr is up 1.8bps at 0.9315%, and 30-Yr is up 2.3bps at 1.6784%.
• Mar 10-Yr futures (TY) down 4/32 at 138-00 (L: 137-31.5 / H: 138-05), ~175k traded.
• While we may not have a definitive result for a couple of days at least, focus is pretty clearly on tonight's Georgia Senate runoffs (polls open at 0700ET, close at 1900ET).
• UK betting odds imply 65% chance of Dems winning the Special runoff, 50/50 on the Regular runoff. In both cases we are at/near highest implied probabilities for Dem wins.
• Dec ISM Manufacturing is the only data point, at 1000ET.
• At 1545ET we hear from two Fed speakers: Chicago's Evans, and NY's Williams chairing an American Economic Association on the Monetary-Fiscal nexus (with text release).
• Supply consists of $60B of 42-/119-day bills, auction at 1130ET. NY Fed buys ~$1.750B of 20-30Y Tsys.