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Steady BoE Early Tailwind For Tsys, Focus Now On Oct NFP

US TSYS

Tsy futures extended session highs late -- USZ1 back to Sep 24 levels, while FVZ and TYZ tapped mid-October lvls before scaling back by the close. In turn, yield curves mixed: flatter in the short end while 5s and 10s vs. 30s holding steeper.
Rates had opened mixed but charged higher after the Bank of England BoE unexpectedly held rates steady.

  • First half: Tsy futures drifting back toward mid-morning highs, while sources report better selling from central banks in 5s and real$ in 10s and 30s. Yield curves mixed with steepeners in 5s vs. 10s and 30s noted earlier.
  • After midday, sources report two-way in the short end w/ leveraged acct selling 2s-3s vs. fast$ and prop acct buying in 2s-5s, continued real-$ selling in 10s-30s. Modest deal-tied rate locks earlier and swap-tied paying in 5s.
  • Focus turns to Fri's October employment report: +450k median est (+194k in Sep) on range of +50k/L to +750k/H from 71 economists polled by Bbg, late whisper number +495k.
  • The 2-Yr yield is down 5.1bps at 0.4145%, 5-Yr is down 8.6bps at 1.1024%, 10-Yr is down 7.9bps at 1.5244%, and 30-Yr is down 5.9bps at 1.9617%.

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