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Holding A Modest Rally With Fedspeak To Lead A Thin Docket

US TSYS
  • Cash Tsys hold the rally seen in Asian trade, with little clear drivers aside from weakness in China-related assets. It stalled in the European session as spillover from dovish BoE speak was offset by a stronger German Ifo survey.
  • Yields are 2-3bps lower, led by 5s and 7s. 2s10s are unchanged on the day at -36.7bps, consolidating yesterday’s partial retracement of the post-FOMC sharp steepening to a high of -31.5bps.
  • TYM4 at 110-18 (+ 05+) remains below yesterday’s 110-26+ and with a key short-term resistance to watch at 111-00+ (50-day EMA). Volumes are below average at 240k.
  • A particularly quiet session today with no data or issuance sees first post-FOMC Fedspeak firmly in focus.
  • Fedspeak: Powell opening remarks before Jefferson and Bowman moderate discussions (0900ET), Barr in Q&A (1215ET), Bostic in Q&A (1600ET) – see STIR bullet.

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