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Higher For Longer Continues

US TSYS
  • Cash Tsy yields have continued to move higher today after Bullard late yesterday wouldn’t rule out supporting a 50bp hike in March in a bid to hit a 5.25-5.5% rate soonest, with further support from hawkish commentary in European hours from ECB’s Schnabel.
  • The move sees front end to belly yields rise to the highest levels since Nov and with 2YY earlier getting within 10bps of cycle highs of 4.799%. 2YY +4.5bp at 4.685%, 5YY +3.5bp at 4.108%, 10YY +3.5bp at 3.896% and 30YY +2.9bp.
  • TYH3 trades 13 ticks lower at 111-16 on solidly above average volumes. It’s off lows of 111-08+ and through support at 111-19+ (lower 2.0% Bollinger Band) to open 110-21+ (2.0% 10-dma envelope).
  • Fedspeak: Barkin (0830ET), Bowman (0845ET)
  • Data: International trade prices for Jan (0830ET) and Leading index for Jan (1000ET)

Source: Bloomberg


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