Risk-Off on Russia Invasion Concerns, US$ Rally, Steady QE TAPER

Aside from the risk-off buying on Russia/Ukraine invasion fears, Tsys extend session highs after the bell -- for a more prosaic reason: measured pace of QE wind-down after NY Fed annc final buy-operations (see 1513ET bullet).

• Final buy-op on Thu March 9: Tsy 2.25Y-4.5Y, appr $4.025B.
• FI markets unwind shorts on bets the Fed could have annc'd an immediate end to QE, quelling chances of intermeeting move prior to March 16 FOMC.
• 30YY falls to 2.2321%, 2.2349 last (-.0814); 10YY falls to 1.9112%, 1.9147%last (-.1147).

Late Trade, Selling Into Risk-Off Bid: Trading desks report pick up in selling after knee-jerk/risk-off move on Russia/Ukraine headline, Tsys have trimmed gains briefly, finish near highs (USH +1-6 at 152-27), equities drew some dip buying but remain weaker (ESH2 around 4418.0).

• Trading desks report leveraged $selling 30s and putting on 5s30s steepeners. Incidentally, 5s30s currently +3.81 at 40.21.
• Eurodollar Options: Better volumes than Treasury options so far, but still fairly sporadic from exhausted markets after Thursday's re-pricing of larger/faster rate hikes due to inflation spike.
• Treasury Options: Trade varied but volumes relatively muted given the shifts in policy pricing since Thursday, not to mention support for underlying futures evaporating around the London close.