Subdued Rate Rally Ahead Impeachment Vote

Rates as well as equities chopped higher Wednesday as the House most certainly will vote to impeach Pres Trump a second time in his term Wednesday. House members kicked off the debate in the morning should have vote count before 1700ET.

• Otherwise somber session as markets absorbed several Fed speaker comments on economy/outlook: Fed Gov Brainard expects Fed to keep buying assets current pace of $120B/m "for some time"; Fed VC Clarida commitment to 2% avg inflation, predicting rate normalization could be slower if survey measures of inflation expectations are low relative to pre-pandemic times.
• Tsys gained after Italy headline: "ITALY MINISTERS QUIT COALITION, PUTTING PREMIER CONTE AT RISK" -bbg amid robust volumes and wo-way trade w/better buying ahead House impeachment vote.
• Already on session highs -- Tsys surge after strong US Tsy $24B 30Y bond auction re-open (912810SS8) yielded 1.825% (1.665% last month) vs. 1.832% WI; w/ 2.47 bid/cover (2.480 prior).
• The 2-Yr yield is up 0bps at 0.145%, 5-Yr is down 2.4bps at 0.4755%, 10-Yr is down 4.1bps at 1.0883%, and 30-Yr is down 5.4bps at 1.8183%.