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Corrective Cycle

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Corrective Bounce

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Paring Midweek Gains

US TSYS
Tsy weaker, scaling back midweek gains, but still in upper half of range after BoJ's steady policy annc set stage for strong FI rally early Wednesday. Tsy 30YY currently 3.6036% (+.0423) vs. 3.5572% overnight low, yield curves mildly steeper (2s10s +.525 at -73.182).
  • Volumes a little below avg (TYH3 <270k) ahead light data: Existing Home Sales (4.09M, 3.95M); MoM (-7.7%, -3.4%) at 1000ET. TYH3 futures 10.5 at 115-10 well above first technical support at 114-16, Jan 18 low.
  • Focus on final (scheduled) Fed speakers ahead policy blackout at midnight:
    • Philly Fed Harker eco-outlook at NJ bank conf, text, Q&A at 0900ET
    • Fed Gov Waller, speaks at Council on Foreign relations, 1300ET
  • Fed funds implied hike for Feb'23 at 26.8bp, Mar'23 cumulative 45.6bp to 4.788%, May'23 56.1bp to 4.893%, terminal at 4.900% in Jun'23.
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Tsy weaker, scaling back midweek gains, but still in upper half of range after BoJ's steady policy annc set stage for strong FI rally early Wednesday. Tsy 30YY currently 3.6036% (+.0423) vs. 3.5572% overnight low, yield curves mildly steeper (2s10s +.525 at -73.182).
  • Volumes a little below avg (TYH3 <270k) ahead light data: Existing Home Sales (4.09M, 3.95M); MoM (-7.7%, -3.4%) at 1000ET. TYH3 futures 10.5 at 115-10 well above first technical support at 114-16, Jan 18 low.
  • Focus on final (scheduled) Fed speakers ahead policy blackout at midnight:
    • Philly Fed Harker eco-outlook at NJ bank conf, text, Q&A at 0900ET
    • Fed Gov Waller, speaks at Council on Foreign relations, 1300ET
  • Fed funds implied hike for Feb'23 at 26.8bp, Mar'23 cumulative 45.6bp to 4.788%, May'23 56.1bp to 4.893%, terminal at 4.900% in Jun'23.