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Increasingly Parallel Cheapening Across The Curve

US TSYS
  • Cash Tsys are seeing an increasingly parallel cheapening across the curve, with 2YY +6bp and 10YY +5bp after the longer end unwound an overnight rally.
  • In a light docket, one of the main drivers came from WSJ sources saying China is weighing a zero-Covid exit, albeit with caution and without a timeline, going against long end yield downward pressure when China NHC officials noted unswervingly adhering to current controls.
  • Treasuries also contend with 15 IG deals looking to price (12 left after Wisconsin, Duke Energy and Southern California Gas so far).
  • TYZ2 of 109-21+ comes close to session lows of 109-19 but doesn’t yet trouble support at Friday’s low of 109-10+.
  • Still to hear ’22 voters Collins & Mester at 1540ET before Barkin (’24) on inflation at 1800ET. A dearth of data/Fedspeak follows tomorrow.

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