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Muted Start, Marginally Richer On Friday

US TSYS

TYU3 deals at 112-07, -0-00+, little changed from levels seen late in Fridays NY session in a muted start to Monday’s dealing.

  • Cash tsys finished dealing ~1bp richer across the major benchmarks on Friday.
  • In a data-light session tsys observed narrow ranges on Friday with little follow through on moves. A recovery off session lows was facilitated by source reports which pointed to a deal on Russian grain.
  • With Wednesday's FOMC rate decision in view, FOMC dated OIS remain stable. A 25bp hike is priced into the meeting with a terminal rate of 5.40% seen in November. There is are ~60bps of cuts seen by June 2024.
  • Also on the docket this week we have flash Services and Mfg PMI today and Q2 GDP crosses on Thursday.
  • There is a thin docket in Asia-Pac on Monday leaving participants on headline watch.

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