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Long End Continues To Pare Gains Ahead Of 20Y Auction

US TSYS
  • The longer end is back cheaper on the day (20YY +1bp, 30YY +0.8bp) with just over an hour before the 20Y re-open and the front-end rally trimmed to 2bps.
  • Mixed data (stronger consumer confidence, weaker housing sales) have on balance helped provide some of the impetus with 2s10s re-steepening to -55bps.
  • TYH3 has pulled back to 113-17 off a pre-data high of 114-01+ but remains off the overnight low of 113-09+, providing initial support having pierced the 50-day EMA of 113-15.

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