Light Twist Flattening Observed

TYH3 deals +0-02+ at 112-13, in the middle of its narrow 0-05 Asia-Pac range, on limited volume of ~65K.

• Early Asia-Pac trade saw some marginal weakness as the region reacted to Tuesday’s bear steepening.
• Still, that move was limited, as the major cash Tsy benchmarks failed to breach their respective Tuesday yield peaks.
• We then saw a pullback from session cheaps, with the long end leading the move as the curve twist flattened, leaving the major benchmarks 1bp cheaper to 2bp richer, with a pivot around 10s.
• Macro headline flow was subdued at best, with continued focus on the latest wind back of COVID-related restrictions in China.
• Looking ahead, the NY docket will see the release of pending home sales & Richmond Fed m’fing data, with 2-Year FRN and 5-Year Tsy supply also due.