Market Roundup: 30YY Top Four Wk High, Little New From Fed Barkin

Tsy futures near lows by midmorning, 30YY taps 3.2263% high - highest since July 11, currently 3.2137%. Cross-over weakness from EGBs followed higher than expected German PPI overnight (+5.3%, +37.2% YoY due to surge in energy prices); UK retail sale up 0.3% last month, but the cost of those sales increased more rapidly by 1.3%.

• Little react to Richmond Fed Barkin this morning as he reiterates the Fed is "very seriously" focused on inflation and will do "what it takes" to lower it to 2% despite "risk of recession on path to 2%". No new ground there, trading desks set sights on next Fri's annual eco-summit in Jackson Hole, Fed Chair Powell scheduled at 1000ET.
• Volume trade starting to thin out (TYU2 currently <675k), no Tsy or corporate supply, though Tsy Sep/Dec rolls generating some volume (Dec takes lead Wed, Aug 31). Sep options also expire next week Friday could start to generate some two-way hedging on the day.
• Technicals for TYU2 currently trading 118-10.5 (-16.5), continuing sell-off paves way for weakness towards 118-05, a Fibonacci retracement. A break of this level would signal scope for a move towards 117-14+, the Jul 21 low. Price has recently cleared a trendline support drawn from the Jun 14 low and this reinforces the bearish theme. Initial firm resistance is at 119-31, the Aug 15 high.
• Currently, 2-Yr yield is up 8.1bps at 3.2779%, 5-Yr is up 7.5bps at 3.1019%, 10-Yr is up 8.8bps at 2.9702%, and 30-Yr is up 7.6bps at 3.2129%.