Pressured On Spillover From BOC

TUU3 deals at 113-04+, 0-02+, in line with late NY levels.

• Cash tsys finished 7-14bps cheaper across the major benchmarks, the belly led the weakness.
• Tsys were pressured in lieu of spillover from the Bank of Canada's decision to raise interest rates 25bps. 10 Year Yields are at the highest level since the debt ceiling bill passed congress.
• The US Tsy provided guidance on plans to increase the issuance of bills to continue financing the government and to rebuild the cash balance to a level in line with policy. Despite this being well flagged the announcement weighed on the short end of the curve.
• A block trade in TU, 14k lots, provided support late in the NY session.
• FOMC dated OIS price ~7bps hike into next week's meeting with a terminal rate of ~5.25% in July. There are ~20bps of cuts priced for 2023.
• The final read of Japanese GDP headlines in Asia today. Further out we have Initial Jobless Claims and Wholesale Trade.