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J.P.Morgan: 20-Year Supply To Be Digested With Relative Ease

US TSYS

J.P.Morgan note that Wednesday will see Treasury “auction $19bn new 20-Year bonds, $4bn smaller than the last new issue auction in November. 20-Year yields have risen approximately 21bp since the last auction and are trading at the highs of this cycle. In relative value terms, the 20-Year sector appears fairly valued along the curve after adjusting for the level of yields and the slope of the curve. Further, liquidity conditions in the sector have improved since earlier in the year: 20-Year market depth is now virtually in line with 30-year depth. Overall, we think tomorrow’s supply should be digested with relative ease.”

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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