February 17, 2025 12:53 GMT
Mild Losses Pared In Holiday Trading, Fedspeak Ahead
US TSYS
- Treasuries have slowly pared overnight losses in what had been spillover from EGBs opening lower on higher defense spending prospects.
- It leaves futures back little changed from Friday’s settle, consolidating the lurch higher on a surprisingly soft retail sales report, amidst unsurprisingly thin volumes on President’s Day (255k).
- TYH5 trades at 109-07+ (-02+), having peaked on Friday at 109-15+ but not close to testing a bull trigger at 110-00 (Feb 7 high). For bears, support is seen at 108-04 (Feb 12 low).
- Fed Funds implied rates are as much as 1bp lower on the day amidst holiday trade, with a next cut fully priced in September and 41bp of cuts for 2025.
- SOFR futures are little changed on the day, outperforming Euribor counterparts which are up to 4 ticks lower in greens and 5 ticks lower in blues on the defense spending theme.
- Triple Fedspeak ahead despite the holiday:
- 0930ET - Harker (non-voter, retiring Jun’25) on the economic outlook (text + Q&A)
- 1020ET - Bowman (voter, hawk) on the economy and regulatory outlook (just text)
- 1800ET - Waller (voter, increasingly dovish) on the economic outlook (text + Q&A)
185 words