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US TSYS
  • Scant data to wrap up the week, Bbg US economic survey for July this morning: showed the US economy will expand 1.5% in 2023, 0.6% in 2024 and 1.9% in 2025, according to a survey conducted by Bloomberg News.
  • Data picks up slightly with S&P Global PMIs. Fed speakers remain in blackout ahead next Wednesday's policy announcement.
  • Friday's focus was largely on headline risk: sources pointed to Russia grain deal headline "RUSSIA FLOATS PLAN TO SUPPLY AFRICA GRAIN WITHOUT UKRAINE" FT. Treasury futures extended gains after the open, amid surge of buying in front month 10Y futures, TYU3 marks 112-13.5 high (+9) before retracing/finishing the day at 112-06.5 on modest overall volume under 900k. Curves held flatter profiles 2s10s -1.665 at -100.927, off session low of -104.021.
  • Projected rate hike expectations gained slightly: July 26 FOMC is 96% w/ implied rate of +24bp to 5.318%. September cumulative of +28.2bp at 5.36%, November cumulative of 33.2bp at 5.409%, and December cumulative of 28.8bp at 5.365%. Fed terminal holding at 5.405% in Nov'23.

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