Richer On Wednesday

TYU3 deals at 109-27, -0-02, in line with late NY levels.

• Cash tsys finished 8-13bps richer across the major benchmarks, the curve bull flattened.
• Tsys extended gains after flash US PMIs were softer than forecast, technical flows and position squaring added a level of support through the session.
• Preliminary Payrolls Benchmark Revision based on the last QCEW suggests the level of payrolls could be revised lower by 306k in the twelve month period to March 2023.
• Earlier in the European session spillover from European FI in lieu of weaker than expected EU Services PMI saw Tsys firm.
• FOMC dated OIS price a terminal rate of ~5.40%, there are ~70bps of cuts priced to July 2024.
• There is a thin docket in Asia today, further out we have US initial jobless claims and durable goods. Kansas City Fed’s annual economic policy symposium in Jackson Hole begins. Fedspeak from Philadelphia Fed President Harker and Boston Fed President Collins is due.