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Leaning On EGBs For Support

US TSYS

The early Wednesday uptick in EGBs supports Tsy counterparts, before a block sale in TU futures (-7.5K/DV01 ~$295K) helps cap the move.

  • TY futures have failed to challenge yesterday’s best levels thus far, last -0-02 at 110-27+, 0-03 off the high of its 0-09 session range.
  • Cash Tsy yields are little changed to 1bp higher across the curve, with a modest bear flattening bias seen.
  • 2s10s and 5s30s tick further away from the multi-week highs seen at the back end of November.
  • Fed funds futures pricing holds off the recent dovish extremes, but still shows ~127bp of cuts for ’24 on the whole as of typing.
  • The first full 25bp cut is priced come the end of the May FOMC, with ~18bp of cuts showing for the March gathering.
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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