November 23, 2022 20:19 GMT
PMI Miss and FOMC Minutes Help Support TY Bullish Outlook
- Cash Tsys have seen a mixed session, but ultimately rally on a combination of notably weak PMI data and somewhat dovish FOMC minutes. The latter pointed to a “substantial” majority of participants judging a slowing in the pace of hikes would likely soon be appropriate with only “various” participants expecting the terminal rate to be “somewhat higher than they had previously expected”.
- The net result is 2YY -3.1bps at 4.483%, 5YY -5.0bps at 3.896%, 10YY -4.7bps at 3.709% and 30YY -8.0bps at 3.744%, with all majors tenors except the 30Y remaining within pre-FOMC session ranges.
- TYZ2 couldn’t exceed its earlier post-PMI peak of 113-00+ on the minutes, touching 112-31+ before retreating to 112-29 at typing. The technical bullish outlook remains intact, with resistance seen at 113-11 (Nov 16 high).
- Thanksgiving tomorrow sees data/Fedspeak resume on Monday all with an eye on Powell speaking on the economic outlook and labour market on Nov 30.