Treasuries Steady, Fed Tone Remains Balanced

TYH4 is currently trading at 111-04, - 02 from New York closing levels.

Treasuries maintained relatively tight ranges throughout the US session. MBA Mortgage Applications reported a 3.7% increase, up from -7.2% prior. Trade Balance came in -$62.2B slightly below the estimated -$62.0B (compared to the prior -$63.2B), while the 10Y auction saw decent demand.

• Mar'24 10Y futures were modestly weaker during the US trading session, staying within a narrow range (TYH4 -3 at 111-06, 111-01 low/111-16.5 high). The yield curves were steeper for most of the day but flattened later in the trading session (2s10s -1.150 at -31.170).
• Fed Speakers were the continued focus during trading: MN Fed Kashkari mentioned he thinks 2-3 25bp cuts this year “ seems appropriate”, Fed Reserve Governor Adriana Kugler said she could not close the door to policy action at any upcoming meetings, including March, “Every meeting is live" while Fed Reserve Bank of Boston President Susan Collins said waiting until 12-month inflation hits 2% for the central bank to begin cutting interest rates would be waiting too long.
• Thursday Data Calendar: Weekly Claims, Fed Speak, 30Y Bond Sale.

Treasuries maintained relatively tight ranges throughout the US session. MBA Mortgage Applications reported a 3.7% increase, up from -7.2% prior. Trade Balance came in -$62.2B slightly below the estimated -$62.0B (compared to the prior -$63.2B), while the 10Y auction saw decent demand.

• Mar'24 10Y futures were modestly weaker during the US trading session, staying within a narrow range (TYH4 -3 at 111-06, 111-01 low/111-16.5 high). The yield curves were steeper for most of the day but flattened later in the trading session (2s10s -1.150 at -31.170).
• Fed Speakers were the continued focus during trading: MN Fed Kashkari mentioned he thinks 2-3 25bp cuts this year “ seems appropriate”, Fed Reserve Governor Adriana Kugler said she could not close the door to policy action at any upcoming meetings, including March, “Every meeting is live" while Fed Reserve Bank of Boston President Susan Collins said waiting until 12-month inflation hits 2% for the central bank to begin cutting interest rates would be waiting too long.
• Thursday Data Calendar: Weekly Claims, Fed Speak, 30Y Bond Sale.

Treasuries maintained relatively tight ranges throughout the US session. MBA Mortgage Applications reported a 3.7% increase, up from -7.2% prior. Trade Balance came in -$62.2B slightly below the estimated -$62.0B (compared to the prior -$63.2B), while the 10Y auction saw decent demand.

• Mar'24 10Y futures were modestly weaker during the US trading session, staying within a narrow range (TYH4 -3 at 111-06, 111-01 low/111-16.5 high). The yield curves were steeper for most of the day but flattened later in the trading session (2s10s -1.150 at -31.170).
• Fed Speakers were the continued focus during trading: MN Fed Kashkari mentioned he thinks 2-3 25bp cuts this year “ seems appropriate”, Fed Reserve Governor Adriana Kugler said she could not close the door to policy action at any upcoming meetings, including March, “Every meeting is live" while Fed Reserve Bank of Boston President Susan Collins said waiting until 12-month inflation hits 2% for the central bank to begin cutting interest rates would be waiting too long.
• Thursday Data Calendar: Weekly Claims, Fed Speak, 30Y Bond Sale.