Modestly Bid; Pre-FOMC Blackout Beckons

U.S.Tsys have richened as we have worked our way through the Asia-Pac session, unwinding a little of Thursday’s cheapening in the process.

• The move higher comes amidst softness in the USD (DXY), as the JPY has strengthened on fresh warnings from the likes of BoJ Gov. Kuroda and FinMin Suzuki re: yen weakness, adding to
• TYZ2 is -0-01 at 115-30 last, just shy of session highs, but coming nowhere near to approaching its peak on Thursday (116-23).
• Cash Tsys run 1.5-3.0bp richer across the curve, with the belly leading the bid. The bid in Tsys has seen 2-Year Tsy yields slip below the 3.50% mark at writing, but remain a little below recent 15-year highs observed on Sep 1 (~3.55%).
• Looking ahead, final July wholesale inventories data is due, with a final round of scheduled Fedspeak by Chicago Fed Pres Evans (‘23 voter), Gov. Waller (voter), and Kansas City Fed Pres George (voter) due ahead of the pre-FOMC blackout period (Sept. 10-22).
• Note that Pres Evans is due to speak on”career opportunities in economics”, and is unlikely to cover comments on monetary policy.