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JGB Cheapening Impulse Fuels Sell-Off, Jobless Claims In Focus Ahead
- Cash Tsys trade 2.5-5bp cheaper, led by 7s, for a modest steepening in 2s10s space but leaving the -46bps well within yesterday’s range.
- JGB impulses drove initial pressure, via perceptions of BoJ communique/policy normalization risks and a poorly received round of 30-Year JGB supply before softer-than-expected Germany IP data helped move away from best levels.
- TYH4 at 110-29+ (-07) trades towards the lower end of the day’s range and remains with yesterday’s, with strong volumes of 465k. Support is seen at 109-16+ (20-day EMA) but the trend direction remains north with initial resistance at the intraday high of 111-09+ before 111-19 (Fibo projection of Oct-Nov price swings).
- Data: Weekly jobless claims (0830ET) are likely to have more impact than yesterday’s modest miss for ADP. We also get Challenger Job Cuts for Nov (0730ET), Wholesale sales/inventories for Oct/Oct final (1000ET), household change in net worth Q3 (1200ET) and consumer credit Oct (1500ET)
- Bill issuance: US Tsy $80B 4W, $80B 8W bill auctions (1130ET)
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.