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Richer Ahead Of Retail Sales, Fedspeak and Debt Ceiling Talks

US TSYS
  • Cash Tsys are off best levels but still sit richer on the day, seen in follow through after softer than expected Chinese economic data overnight. It comes ahead of a heavy session, with retail sales and less so IP the pick for data, another heavy slate of Fedspeak and President Biden due to speak with McCarthy and Congressional leaders at 1500ET for ~90 minutes after McCarthy yesterday poured cold water on weekend optimism.
  • 2YY -3.1bp at 3.979%, 5YY -4.3bp at 3.425%, 10YY -3.6bp at 3.466%, 30YY -2.8bp at 3.814%.
  • TYM3 trades 9 ticks higher at 115-16+ off an earlier high of 115-18+ and through yesterday’s Empire Mfg induced high of 115-15+. It has pushed off support at the 115 level (115-01+ May 9 low, 114-30+ 50-day EMA) but remains some way off resistance at 116-16 (May 11 high).
  • Data: Retail sales Apr (0830ET), NY Fed services activity May (0830ET), IP Apr (0915ET), Cap util Apr (0915ET), Business inventories Mar (1000ET), NAHB housing index May (1000ET).
  • Fedspeak: Mester (0815ET), Barr (1000ET), Williams (1215ET), Logan (1515ET), Bostic & Goolsbee (1900ET)
  • Bill issuance: US Tsy $36B 52W bill auction (1130ET)

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