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Mildly Bull Steeper On Low Volumes Ahead Of CPI

US TSYS
  • Cash Tsys trade mildly bull steeper in thin volumes ahead of today’s CPI release (MNI Preview here). It clearly headlines the docket amidst heightened data dependence, although Fedspeak could also be of note afterwards if rate cuts timing is again brought up following Williams and Harker earlier in the week and also as former Fed economist Nathan Sheets discussed with MNI yesterday (here). Daly is however the only scheduled speaker for today who hasn’t spoken since the July FOMC decision.
  • 2YY -2.1bp at 4.787%, 5YY -1.6bp at 4.121%, 10YY -0.6bp at 3.999%, 30YY +0.0bp at 4.170%.
  • TYU3 trades unchanged on the day at 111-12 off an earlier low of 111-06+, with low volumes at just 185k. Resistance at 111-17+ (20-day EMA) was briefly pierced yesterday with a high of 111-20 but the trend direction remains bearish with support seen at 110-23 (Aug 7 low).
  • Data: CPI Jul (0830ET), Real avg earnings Jul (0830ET), Weekly jobless claims (0830ET), Monthly Budget Statement Jul (1400ET).
  • Fedspeak: Daly (’24 voter) 1100ET, Bostic (’24) 1500ET, Harker (’23) 1615ET
  • Note/bond issuance: US Tsy $23B 30Y Bond auction (912810TT5) – 1300ET
  • Bill issuance: US Tsy $75B 4W, $65B 8W bill auctions – 1130ET

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