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(U1)‌‌ Bullish Theme Intact


Expiries for Jun15 NY cut 1000ET (Source DTCC)

US TSY FLOWS: Trades modestly higher after the bell, after revisiting early
highs ahead minutes -- bid evaporated on hawkish tone. While majority Fed voters
saw no rate change in '19, "patience" stance may need review. Couple equity sell
programs post minutes but rebound/extend session highs after rate close.
Equities firm (SPX +10.0, 2892.5); US$ index back near lows (DXY -.113, 96.893).
- Earlier, post CPI chop, Tsy rally gained traction w/focus on core slowing for
second month in a row (apparel drop -1.9% largest since 1949), less consumer
inflation pressure = weaker demand raising concern over recession (3M10Y
flattened. Decent two-way trade in fronts to intermediates, hedge fund selling
10s, fast$ buying TIPs, prop and real$ buying intermediates to long end as Tsys
following EGBs higher.
- On tap for Thu: Wkly claims; Mar final PPI; wkly securities holdings. US TSY
$16B 30Y bond auction (912810SF6). Fed speakers: NY Fed Pres Williams, StL Fed
Pres Bullard, Fed Gov Bowman. The 2-Yr yield is down 2.9bps at 2.3212%, 5-Yr is
down 3.2bps at 2.2737%, 10-Yr is down 3.2bps at 2.4685%, and 30-Yr is down
1.9bps at 2.8954%.
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