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Muted Start, Cash Closed Due To MLK Day


TYH3 deals at 114-25, +0-00+, little changed from Friday's late NY levels. Cash Tsys are closed today due to the MLK Day holiday.

  • Cash Tsys were 3-9bp cheaper on Friday, as the curve bear flattened.
  • A bid in core FI saw Tsys firm early in Friday's European session. Early NY trade was two-way, before weakness was observed into the bell.
  • U of Mich data was firmer than expected, as the sentiment metric hit its highest level since Apr 2022. The 1-Year inflation expectations component hit the lowest level since April 2021.
  • Fedspeak from Atlanta Fed President Bostic and Philadelphia Fed President Harker reiterated themes observed in recent communique re: the potential for a step down to a 25bp hiking pace in Feb.
  • There was little reaction to Treasury Sec Yellen's comments on the debt ceiling, as she noted that the U.S. will take extraordinary steps to avert a default.
  • PPI data from Japan and MLF operations from China headline the Asia-Pac session. Participants will have one eye on BOJ speculation and any resultant moves in JGBs.

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