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Tsy Ylds Make Multi-Month Highs As Wkly Jobless Claims Recede

Tsys holding weaker levels after the closing bell, near middle narrow session range, yield curves see-sawing all day, finish mostly flatter (5s30s -5.9 at 90.8 after topping 98.0 earlier in session). US$ rebounded (DXY +214 at 93.771 late), equities held modest gains near all-time highs (ESZ1 +5.5 at 4533.50).
  • Tsys held weaker but off lows after weekly and continuing claims came out lower than est (290k vs. 297k est; 2.481M vs. 2.548M est), Philly Fed lower than exp at 23.8 vs. 25.0 est and mixed details (orders, shipments and employment solid).
  • Tsys futures recede back to lower half relatively narrow session range after Sep existing home sales climbed 7% to 6.29M, better than 6.09M est.
  • Swap curve flattened with short end widening on back of heavy (14k) Block/crosses in Eurodollar Red packs in the first half, likely payer/sale driven while AerCap issued $51B in debt over 9-tranches spanning 2-20Y generated rate lock selling as well. Spds should reverse/narrow as supply hedges unwound.
  • Fed Chair Powell joins policy panel discussion hosted by South African Reserve Bank Friday at 1100ET -- probably last to speak before media Blackout late Friday (through Nov 4 -- FOMC on Nov 2-3).
  • Late Tsy yields: 2-Yr yield is up 4.9bps at 0.4342%, 5-Yr is up 4.8bps at 1.2133%, 10-Yr is up 2.1bps at 1.678%, and 30-Yr is down 0.4bps at 2.1307%.

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