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Off Lows Even As China LPR Move Supports Equities

US TSYS

TYM2 last deals +0-02 at 119-24+, 0-03 shy of the peak of the 0-10+ Asia-Pac range, on volume of ~100K. Benchmark cash Tsys run 1bp cheaper to 1bp richer as the curve twist flattens, pivoting around 10s.

  • Tsys unwound the cheapening impulse that came on the back of the latest Chinese 5-Year LPR fixing moving 15bp lower (consensus looked for a 5bp cut), with the move aimed at supporting the Chinese property sector. There wasn’t an overt reason for the uptick from session cheaps, with wider risk assets underpinned and a lack of major risk-negative headline flow evident.
  • Note that earlier in the session we had some mixed headlines re: the COVID situation in the Chinese city of Shanghai (reopening plans for the financial district of Pudong were outlined vs. 3 COVID cases being detected outside of the city’s quarantine facilities).
  • A Fox Business interview with St. Louis Fed President Bullard headlines domestically on Friday.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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