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Rates Extend Lows, Bouncing

US TSY FLOWS

Tsys gapped lower just ahead stocks open, further weighed by large -30k FVH2 note sale at 120-28.25 that pushed 5s to 120-24 low in the aftermath. Does not appear to be headline driven, sources report prop, fast$ and option-tied buying in shorts to intermediates as futures bounce. Yield curves mixed now:

  • 3M10Y +1.111, 139.646 (L: 135.905 / H: 140.929)
  • 2Y10Y +0.132, 78.364 (L: 76.277 / H: 79.496)
  • 2Y30Y -0.353, 116.569 (L: 114.878 / H: 118.248)
  • 5Y30Y -0.586, 58.36 (L: 58.113 / H: 60.954)

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