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Modestly Cheaper, 2Y Supply To Kick Off Week’s Coupon Tsy Issuance

US TSYS
  • Cash Tsys trade 1.5-2.5bp cheaper, with the sell-off coming in European hours to more than reverse an initial modest bid seen on the BoJ decision. 2s10s increases only slightly on the day to -27.5bps.
  • TYH4 sits just half a tick off lows of 111-07+ (- 08) but has remained within yesterday’s range amidst low volumes of just 220k. The bear cycle is seen remaining in play, with support at 110-26 (Jan 19 low).
  • Pre-market corporate earnings are in the headlines currently, after which headlines/flow are likely to set the tone before focus later in the session on 2Y supply.
  • Data: Philly Fed non-mfg, Jan (0830ET), Richmond Fed mfg, Jan (1000ET)
  • Note/bond issuance: US Tsy $60B 2Y Note auction (91282CJV4) – 1300ET
  • Bills issuance: US Tsy $46B 52W Bill, $75B 42D CMB auctions – 1130ET

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