Futures Slightly Stronger After Yesterday’s Cash Curve Twist Steepening

TYH4 is trading at 111-08+, +0-02 from NY closing levels.

• This comes after US tsys twist-steepened, pivoting at the 5s, with yields 1bp lower to 5bps higher. US tsys reversed early gains after lower-than-expected Initial Jobless Claims (187k vs 205k est), not to mention higher than expected Building Permits (1.495M vs 1.476M est) and Housing Starts (1.460M vs 1.425M est, prior down-revised to 1.525M from 1.560M). MNI’s Chicago Business Barometer was also revised up to 47.2 in December from 46.9, as a result of the annual seasonal adjustment recalculation.
• Fedspeak: Philly Fed Harker said he expects inflation to fall steadily toward 2% and labour market tightness to continue to ease, suggesting heightened chances of a soft landing. Atlanta Fed Bostic Thursday repeated he expects policymakers to begin cutting interest rates in the third quarter, but added if there is a further accumulation of soft inflation data then cuts could begin sooner.
• Later today sees U. of Mich. Sentiment, Existing Home Sales and Total Net TIC Flows. Also, Fed's Daly Speaks on Fox Business and in Fireside Chat.
• Before then, Japan releases it National CPI for December.