Post-20-Year Auction Curve Flattening Extends

TYZ3 prints +0-04+ at 108-31+, 0-02 off the peak of its 0-06+ early session range.

• Initial resistance comes in at the Nov 17 high (109-08+).
• Cash Tsy yields are 0.5-4.5bp lower, with the late NY curve flattening extending further.
• 2s10s moves to fresh multi-week lows as a result, while 5s30s remains in the recent range.
• Tsys remain underpinned as tailwinds from a well-received round of 20-Year Tsy supply persist, and if anything, were magnified by a relatively well-received round of 20-Year JGB supply in Asia.
• Asia Pac block flattener flow also factored into the curve/outright moves. That came in the form of FV/US (~$700K DV01) & FV/WN (~$330K DV01) trades.
• Reported positives surrounding the Israeli-Hamas hostage situation have not really filtered into wider markets, with some hurdles still seemingly in place before there is any agreement on that front.