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Heading North


Modi, AMLO Top Major Economy Leader Poll, Macron Last


Under Pressure


Trend Condition Remains Bearish

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A flat re-open for T-Notes, last dealing -0-05+ at 130-15 after the contract finished Wednesday trade around the middle of its daily range.

  • The curve twist steepened on Wednesday, with 2s richening by ~1bp as a little of the recently embedded Fed rate hike premium faded out of pricing, while the weakness in the long end extended on the back of a soft round of 20-Year supply. 30s lead that weakness, cheapening by 5bp on the day.
  • The 20-Year auction saw the largest tail on record for such supply, with the cover ratio slipping below its recent averages, while dealer takedown edged back up to its own recent average.
  • The Fed's beige book noted that most districts reported significantly elevated prices, while labour shortages weighed on growth, with worker turnover elevated.
  • Fiscal jousting continued on the Hill, with various source reports hitting late in the day on that matter.
  • There isn't much in the way of tier one headline risks slated during Asia-Pac hours. Weekly jobless claims data, the latest Philly Fed business outlook survey, 5-Year TIPS supply, the Tsy's month-end supply announcement and another address from Fed Governor Waller are all due on Thursday.