Flat Start To Holiday-Impacted Trade

TYU2 marginally below late Friday levels at the re-open, last dealing +0-01 at 120-05+, with e-minis marginally below their late Friday peak.

• A quick reminder that cash Tsys are closed on Monday owing to the U.S. observance of the Memorial Day holiday, while Tsy futures will be subjected to curtailed trading hours.
• To recap, the curve twist flattened on Friday, pivoting around the 7- to 10-Year zone. Roughly in line with expected PCE data, coupled with a very modest beat in the personal spending print (which also saw a positive revision to the previous month’s reading) was enough to support broader sentiment during NY hours, allowing the S&P 500 to extend its weekly gains (+2.5% on Friday), with the debate re: the inflation top continuing to intensify.
• Still, the moves in Tsys were limited ahead of the long Memorial Day weekend, with the major benchmarks finishing 1bp cheaper to 2bp richer across the curve.
• The Asia-Pac docket is virtually empty on Monday, with the rection to the moderation of COVID restrictions in the Chinese cities of Beijing & Shanghai, coupled with announcements re: a raft of support measures for the Shanghai economy likely to set the tone in Asia. Elsewhere, an EU-wide accord re: the next round of Russian energy sanctions (namely on oil exports) has not been forthcoming, with discussions on the matter set to continue on Monday.