### POV, MARKETS COILING FOR BIGGER MOVES...>

US TSYS: ### POV, MARKETS COILING FOR BIGGER MOVES

No presser from departing Fed chairman Janet Yellen after today's FOMC policy

annc, nor Summary of Economic Projections (SEP) today. Markets would be caught

flat footed if anything other than a no change in rate IS announced, so why does

it feel like markets are coiling for a move? 

- Just a couple wks ago, mkts were anxious over 10Y yld breach of 2.5%, 5Y ylds

topped that Tue and are revisiting Apr'10 lvls (2.5290%, +.0236) while 10Y ylds

to Apr'14 lvls (2.7406, +.0207)! Bill Gross tweeting 3% target as mkts play

catch-up with pricing in more quarterly hikes a large factor. 

- Note, MNI Pinch model is giving the March 21 FOMC 100% chance of the first

hike of 2018, June 13 FOMC a new high with 70% now, while Sep 26 chances are

only around 38.9%. Dealers have been pushing their rate hike estimates higher

for weeks if not months where "only 2" hikes for 2018 is the minority, 3-4 more

common, with some positing a repeat in '19.

- Expect higher ylds in near term, barring flagging data (ADP beat bodes well

for NFP +180k est), flatter, but not inverted curves as Tsy ups auction sizes.