Futures Biased Lower On Chinese Property Simulus & Waller’s Hawkish Notes

Tsy futures move lower at the re-open, owing to the previously alluded to Chinese property market support package and hawkish Fedspeak from Governor Waller, who stressed that the recent CPI data only reflected one data point (that markets got way out in front of). Waller also alluded to the potential for a 50bp hike at the central bank’s December meeting, while stressing that the Fed is not softening its stance. Waller then pointed to a need to ensure that inflation expectations remain anchored, while highlighting that rates will need to stay at high levels for a while owing to the current level of inflation.

• Elsewhere, weekend news flow included confirmation that the U.S. Senate will remain in the hands of the Democrats, although the seemingly impending switch of the House to Republican control is creating plenty of worry re: the potential for political gridlock on the Hill.
• This comes after Tsy futures pared losses in narrow Friday trade.
• The reaction of Chinese markets to the aforementioned property market stimulus is set to dominate in Asia-Pac hours, with no major macro risk events slated during the session. Further out, Monday will see Fedspeak from Brainard and Williams, with the latter’s comments set to cross in the NY-Asia crossover.