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Tsys rallied sharply amid heavy.....>

US TSYS SUMMARY
US TSYS SUMMARY: Tsys rallied sharply amid heavy volume Thursday.
- Yields dropped hard over the course of the day, with 5Y/10Y/30Y yields
reaching levels not seen since Nov-Dec 2017, and in the 2Y not seen since Feb
2018 with short end leading the charge lower.
- 2-Yr yield down 9.5bps at 2.1274%, 5-Yr down 9.4bps at 2.0858%, 10-Yr down
8.8bps at 2.2939%, and 30-Yr down 7.7bps at 2.7308%.
- Poor European data compounded by weak US flash PMI for May which included
weakest new business orders since the Composite series began in 2009.
- Rate cut concerns clearly back: several Eurodollar futures contracts hit new
highs, and the spread of Jun19-Jun20 Eurodollar futures moved further inverted,
implying 3M rates moving 52bps lower over the course of the next year.
- Amid all this, 10Y TIPS auction saw lowest yield since Jan 2018 and highest
cover ratio since Apr 2010.
- The last data before the Memorial Day holiday weekend includes Apr durable
goods and St Louis/NY Fed GDP Q2 Nowcasts.
- Reminder of early market close Friday (1300ET), and Monday close.

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