Softer In The Final Asia-Pac Session Of The Week

U.S. Tsys were subjected to some light pressure overnight, with U.S. President Trump pledging to work towards a smooth transition for the incoming Biden administration and cautiously optimistic news flow surrounding existing COVID-19 vaccines being effective against the recently discovered variants of the virus at the fore. T-Notes now sit below their Thursday low, with the contract last -0-06+ at 136-24, just off lows, while the cash curve has been subjected to some bear steepening, with 30s sitting ~2.5bp cheaper on the day at typing. There was also some focus re: talk of a Biden infrastructure plan (albeit linked to higher taxes for high earners), which came via an Axios sources piece.

• Most of the Fedspeak seen over the last 24 hours has touched on the potential for tapering of the central bank's asset purchase schemes, in one way or another, with various views given. While some stressed that it is too soon to ponder such moves the NY-Asia crossover saw Bostic note that the Fed may taper earlier than expected N.B. this comes after a recent RTRS interview saw Bostic note that he is "hopeful that in fairly short order we can start to recalibrate" Tsy and MBS purchases.
• December's NFP report headlines locally on Friday, with an address from Fed Vice Chair Clarida also due.