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Post-7Y Auction Update

US TSY FUTURES
  • Futures remain weaker on the day, but have quickly recovered from the knee-jerk sell-off following the 1.1bp tail in 7s (3.563% vs. 3.552% WI).
  • Front month 10Y futures currently at 114-29 (-20.5) vs. 114-23.5 low, 10Y yield currently at 3.509% (+.0606) vs. 3.5223% high.
  • Curves maintaining flatter profiles (2s10s -4.233 at -54.681) with the short end underperforming after this morning's data underscored expectations of a 25bp hike next week, while implied rate cuts for year end remain well off Tuesday highs (Dec'23 cumulative -33.8bp (-52.1bp Tue) at 4.491%.
  • FI markets trading sideways near lows now, generally quiet as participants await tomorrow's PCE, ECI, Chicago PMI, UofM Sentiment.

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