Free Trial

Rates Surge, March 50Bp Liftoff Cools, Geopol, Policy Risk Events Ahead


FI Markets very well bid after the bell, 30Y Bonds topping early overnight gap bid late; yield curves bull steepening: 5s30s +4.081 at 44.62. 30YY currently 2.1674% -0.1064 vs. 2.1618% late session low (2.2507% high).

  • Russia invasion of Ukraine main driver for risk-off support in rates. Trading desks report preop, fast- and real$ buying 5s, continued foreign and domestic real$ and bank portfolio buying in 10s-30s.
  • Short end funding concerns heat up w/3M FRA/OIS gap wider overnight, tapped 23.80 around Asia/London cross, gradually receding since: currently 18.40 +5.30 vs. late Fri.
  • Bostic reiterated need to "move off emergency rate stance", is supportive of 25bps hike at the March 16 FOMC -- unless inflation measures continue to climb -- opens the possibility of 50bp liftoff.
  • Wide, near 0.100 range in lead quarterly Mar'22 Eurodollar futures, near highs as 50bps liftoff inches lower. Reds-Gold surge 0.14-0.20 higher by the close. Large Block buys+50k EDH2 99.335, +50K EDU2 98.525, +20k EDM 98.92.
  • US Pres Biden State of the Union Address Tue evening 2100ET
  • Fed Chair Powell will be giving the semi-annual monetary policy report testimony to the House Financial Services Committee on Weds March 2 and the Senate Banking Committee on Thu March 3 - 1000ET.
  • The 2-Yr yield is down 14.1bps at 1.4283%, 5-Yr is down 14.6bps at 1.7194%, 10-Yr is down 12.6bps at 1.8353%, and 30-Yr is down 9.9bps at 2.1745%.

To read the full story


MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.