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Treasuries Bear Flatten To New 2s10s Cycle Lows

US TSYS
  • Cash Tsys bear flatten on the day with the front end continuing a sizeable sell-off since yesterday’s FOMC and hawkish dot plot. 2YY are up 4bps even whilst remaining firmly within overnight ranges having touched a yet new cycle high of 4.1253% before moving off extremes helped in part after JPY intervention and ahead of the BoE decision at 1200BST.
  • The flattening sees 2s10s hit cycle lows of -57bps (currently -55bp) with 2YY +4.2bps at 4.090%, 5YY +2.5bps at 3.791%, 10YY -0.2bps at 3.528% and 30YY -2.7bps at 3.475%.
  • Data: Initial jobless claims covering a payrolls reference week plus indicators with the leading index for Aug and KC Fed manufacturing for September.
  • Bond issuance: US Tsy $15B 10Y TIPS auction re-open (91282CEZ0) – 1300ET
  • Bill issuance: US Tsy $50B 4W, $45B 8W bill auctions – 1130ET

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