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Treasuries Pause For Breath Ahead of Payrolls, ISM

US TSYS
  • Cash Tsys have paused for breath ahead of payrolls, with very little action overnight although cheapening slightly in recent trade despite S&P Emini moving back towards the session low.
  • 2YY +2.5bps at 2.654%, 5YY +2.1bps at 2.930%, 10YY +1.3bps at 2.920% and 30YY +1.0bps at 3.085%. 2s10s sits within its recent range at 27bps.
  • TYU2 sits down just 2 ticks at 118-25 in a particularly tight range for the session and within well yesterday’s range. Volumes are even softer than yesterday with the second day of the UK bank holiday. Support is eyed at 118-16+ whilst initial resistance is seen at the 50-day EMA of 120-09+.
  • Data: Payrolls is the main event at 0830ET (https://marketnews.com/mni-us-payrolls-preview-softer-jobs-growth-eyed) but also followed by the finalised S&P Global Composite PMI at 0945ET before ISM Services at 1000ET. The ISM manufacturing report on Wed was strong except for employment which showed a pull back supposedly on a slight improvement in labour churn as quits dipped.
  • Fedspeak: Repeat appearances from Brainard (no text) and Mester (CNBC interview on payrolls reaction).
  • No issuance today.

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