T-Notes Pull Back From Early Highs

T-Notes crept higher this morning, carried by the impetus generated by an apparent stalemate in U.S. fiscal talks, combined with worrying coronavirus situation in some states. Little reaction to Moderna's deal with the Trump administration to supply 100mn doses of Covid-19 vaccine. The contract has pulled back from highs and last trades +0-05+ at 139-13+. Yields sit slightly lower in cash trade, curve has largely pared earlier flattening. Eurodollar futures last deal unch. to +1.0 tick through the reds.

• JGB futures have wavered, looking for a clear direction. The contract last deals at 151.85, 15 ticks shy of settlement. Cash JGB curve runs a touch steeper. Enhanced liquidity auction for off-the-run 15.5-39 Year JGBs and flash machine tool orders headline locally today.
• Aussie YM -0.5 & XM -3.5, both range-bound so far. Cash curve has bear steepened, with yields sitting 0.6-4.8bp higher as we type. Bills trade unch. to -2 ticks through the reds. Australia's Westpac Consumer Confidence Index plunged and "is back near the extreme low of 75.6 seen back in April when Australia entered a national lockdown", per Westpac commentary. Wage price index comes out shortly. The RBA offered to buy A$2.0bn ACGBs (eligible lines: Apr '23, Apr '24) after offering to buy A$1.0bn worth of analogical securities on Monday. Meanwhile, the development of the coronavirus situation & RBNZ MonPol decision across the Tasman will provide interest.