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Markets Closed On Monday

AUSSIE 10-YEAR TECHS

(Z2) Remains Vulnerable

US TSYS

A Touch Cheaper To Start The Week

NEW ZEALAND

Markets Closed On Monday

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Tsys Hold Weaker/Narrow Range Ahead Wed's July CPI

US TSYS

Treasury futures hold modestly weaker after the bell, near middle of session range on light summer volumes (TYU2<815k) - thin participation ahead of Wednesday's key CPI data: 0.2% est, 1.3% prior; YoY 8.7% est, 9.1% prior. Yield curves mostly flatter after the bell, 2s10s nearly tapped -50.0, new 22 year low of -49.264.

  • Morning data spurred buying in intermediates to long end:
    • Nonfarm labour productivity was roughly as expected in the preliminary Q2 release, falling -4.6% Q/Q saar after -7.4% as output fell -2.1%
    • With hourly compensation jumping 5.7% (but -4.4% in real terms), ULCs saw a smaller moderation than expected from 12.7% to 10.8% (cons 9.5%).
  • Tsy Auction: Muted react after $42B 3Y note auction (91282CFE6) small stop-through: 3.202% high yield vs. 3.205% WI; 2.50x bid-to-cover vs. 2.43x last month.
    • Indirect take-up climbed to 63.08% vs. 60.37% prior; direct bidder take-up at 17.28 vs. last month's 19.35%; primary dealer take-up 19.64% vs. 20.28%.
  • Cross asset update: Stocks off modest lows (SPX eminis at 4126.75 -15.00); Spot Gold firmer +6.58 at 1795.54; Crude near steady (WTI +0.04 at 90.80).
  • Currently, 2-Yr yield is up 7.9bps at 3.2841%, 5-Yr is up 7.4bps at 2.9797%, 10-Yr is up 4bps at 2.7974%, and 30-Yr is up 2.1bps at 3.0057%.
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Treasury futures hold modestly weaker after the bell, near middle of session range on light summer volumes (TYU2<815k) - thin participation ahead of Wednesday's key CPI data: 0.2% est, 1.3% prior; YoY 8.7% est, 9.1% prior. Yield curves mostly flatter after the bell, 2s10s nearly tapped -50.0, new 22 year low of -49.264.

  • Morning data spurred buying in intermediates to long end:
    • Nonfarm labour productivity was roughly as expected in the preliminary Q2 release, falling -4.6% Q/Q saar after -7.4% as output fell -2.1%
    • With hourly compensation jumping 5.7% (but -4.4% in real terms), ULCs saw a smaller moderation than expected from 12.7% to 10.8% (cons 9.5%).
  • Tsy Auction: Muted react after $42B 3Y note auction (91282CFE6) small stop-through: 3.202% high yield vs. 3.205% WI; 2.50x bid-to-cover vs. 2.43x last month.
    • Indirect take-up climbed to 63.08% vs. 60.37% prior; direct bidder take-up at 17.28 vs. last month's 19.35%; primary dealer take-up 19.64% vs. 20.28%.
  • Cross asset update: Stocks off modest lows (SPX eminis at 4126.75 -15.00); Spot Gold firmer +6.58 at 1795.54; Crude near steady (WTI +0.04 at 90.80).
  • Currently, 2-Yr yield is up 7.9bps at 3.2841%, 5-Yr is up 7.4bps at 2.9797%, 10-Yr is up 4bps at 2.7974%, and 30-Yr is up 2.1bps at 3.0057%.