Modest Pressure For Core FI

Headline flow was muted during Asia-Pac hours, with the NYT providing comments from EU Commission chief Von Der Leyen pointing to U.S. tourists being able to visit the EU in the summer of '21. Headline flow was also light over the weekend, with most of the focus falling on the world looking to help India through its COVID outbreak and continued insistence on the need for targeted fiscal stimulus (and resistance to the use of the reconciliation measure to pass any linked legislation) on the part of moderate U.S. Democratic Senator Manchin.

• The U.S. Tsy space has nudged lower, with T-Notes -0-03+ at 132-10+, 0-00+ off lows. There is some light steepening in play in cash trade, 5+-Year yields have cheapened by 1.0-1.5bp as of typing. Ranges remain tight. E-minis are now in the green, albeit marginally, while the USD has struggled.
• JGB futures ticked lower during the Tokyo morning, with the move extending during the Tokyo afternoon after an uptick in the offer/cover ratio in the latest round of 5- to 10-Year BoJ Rinban ops. The cash curve was subjected to some modest twist steepening.
• Very little to report for Aussie bonds. The presence of the RBA's scheduled ACGB purchases may have provided a light bid early on, but there has been a modest downtick in recent trade, with YM -1.0, XM +0.5, in line with the broader global core FI space.