Modest Twist Steepening Of The Curve, Narrow Ranges In Play

Tsys tick away from early session lows alongside Bunds, as participants assess the previously flagged hawkish ECB sources piece from RTRS and softer than expected UK GDP data.

• The RTRS sources piece biased Tsys a little cheaper in the NY-Asia handover, although the move was limited, with TYZ3 sticking to the contained range established earlier in the session.
• TYZ3 managed a shallow look below Tuesday’s low as Europe filtered in, but the move was very limited and failed to test initial technical support.
• TYZ3 last trades just shy of the top of its 0-03+ range, last -0-04.
• Cash Tsys run 0.5bp richer to 0.5bp cheaper, twist steepening.
• FOMC-dated OIS pricing is little changed on the day, unwinding any modest upticks linked to the ECB sources story. Terminal policy rate pricing still shows at 5.45% come December, before 32bp of cuts are seen through June ’24.