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Treasuries See Sizeable Bear Flattening

US TSYS
  • Cash Tsys have seen a sizeable bear flattening on the day after opening firmer on Russian escalation fears. The intraday sell-off has been across the curve and has gathered pace of late, but the long end had opened that much firmer.
  • 2YY +7.7bps at 1.543%, 5YY +4.9bps at 1.869%, 10YY +1.9bps at 1.948% and 30YY +1.4bps at 2.254%. This pushes 2s10s back to 41bps, close to early last week flats of 38bps having touched highs of 53bps on Thu.
  • TYH2 has dropped 27 ticks intraday but is only 7 ticks down on yesterday’s close at 126-14. It's through yesterday's low but remains above support at the bear trigger of 125-17+ (Feb 10), whilst resistance is still seen at 127-01 (Feb 7 high).
  • Fedpeak: Bostic (non-voter) with moderated Q&A, no text (1530ET)
  • Data: Various house price indices, Markit preliminary PMIs for Feb and Conference Board consumer confidence
  • NY Fed buy-op: TIPS 1Y-7.5Y, appr $1.025B vs. $2.025B prior (1030ET).
  • Tsy issuance: $60B 13-W, $51B 26-W bill auctions (1130ET), $34B 52-W and $52B 2-Y notes (1300ET).

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