Holding Above Asia Lows

Tsys stick to a narrow range through early London trade, little impact from the light downtick in Bund futures.

• TYM4 unchanged at 110-02+ (109-30+-110-05+ range).
• Any extension lower would expose the bear trigger at the Feb 23 low (109-25+).
• Cash Tsy yields 2bp lower to 0.5bp higher, twist steepening.
• Year-to-date highs in benchmark yields remained intact during last week’s sell off.
• Higher for longer talk surrounding the Fed over the weekend (FT survey, Trump reportedly eying hawks to lead the Fed if successful in Presidential run) and hawkish BoJ sources weighed at the CME re-open.
• That was before a BoJ bond buying announcement countered weakness.
• Lower tier U.S. data is due today, with broader macro focus on this week’s heavy central bank decision schedule.
• The Fed remains in its pre-meeting blackout.
• FOMC-dated OIS little changed to start the week. 1~6bp of cuts priced through June, ~72.5bp of easing priced through year end.