JPM analysts said that since the Oct....>

US TSYS/30Y: JPM analysts said that since the Oct. 30Y bond reopening auction,

"30-year yields have declined by approximately 9bp and are 20bp below their

highest levels in late October. Certainly some of this has been driven by

changing Fed expectations: over the last 3 months, 10s/30s has been

counter-directional with 2-year yields, flattening as markets price more Fed

tightening and front-end yields rise, and vice versa." 

- They add however that a chart "shows that the curve has flattened by more than

would be implied by the rise in 2-year yields. We think at least some of this

reflects shifts in Treasury issuance expectations, as Treasury Secretary Mnuchin

last week indicated ultra-long bonds might not make sense," and the Nov.

refunding announcement "indicates to us that Treasury is more likely to focus

increased issuance at the front end rather than across the curve."