Short End Yields Surge Amid Global Rate Sell-Off

Global short-end rates sold off sharply overnight Thursday, with the Treasury curve bear flatter.

• The reaction from the Bank of Canada's unexpectedly hawkish turn Wednesday was exacerbated by the RBA's non-intervention on surging 2-yr bond yields overnight. These developments come ahead of today's ECB decision, and next week's Fed and BoE meetings.
• 2Y yields hit a fresh post-March 2020 high (0.5621%) as Eurodollar futures sold off (Reds last off 8 ticks). Conversely 10s and 30s yields were actually lower on the session by mid-morning Europe trade.
• 2-Yr yield last up 4.7bps at 0.5503%, 5-Yr is up 4.4bps at 1.1944%, 10-Yr is up 0.9bps at 1.5501%, and 30-Yr is down 0.3bps at 1.9479%. Dec 10-Yr futures (TY) down 10/32 at 130-27.5 (L: 130-25 / H: 131-02.5) on elevated volumes (~465k traded).
• In data, 0830ET sees jobless claims and advance Q3 GDP, while we get pending home sales at 1000ET and KC Fed manufacturing at 1100ET.
• Supply continues in earnest with $62B 7Y Note auction at 1300ET (also $85B combined in 4-/8-week bills at 1130ET). NY Fed buys ~$12.425B of 0-2.25Y Tsys.