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J.P.Morgan Believe That 7-Year Supply Will Be Digested Smoothly

US TSYS

J.P.Morgan note that Thursday will see the "Treasury auction $62bn 7-year notes, unchanged in size from last month. The 7-year sector appears fairly valued versus the wings after adjusting for the level of rates and the shape of the curve. The WI 7-year roll opened at +1.375bp, close to fair value, and is trading there now, underperforming the erosion of carry. Overall, despite the higher yield levels, we think tomorrow's auction will require above-average end-user demand to be digested smoothly."

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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