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Tsys trading mixed after the........>

US TSYS SUMMARY
US TSYS SUMMARY: Tsys trading mixed after the bell, curves bear steepening after
Fed chair comments from NY Economic Club conf deemed more dovish than expected.
Likely forced curve flattener unwinds in rates and swap (30Y spd back to March
inverted lows). Equities surged on the dovish tone, but gold gained, DXY
weakened.
- Fed chair Powell gave no hint that the Fed was reevaluating its outlook for
policy or considering an imminent pause in planned rate increases. He also did
not respond to overnight criticism from President Donald Trump blaming stock
market declines and factory closures on rate hikes.
- Rates initially rallied across the board following headline, but long end
retraced/extended session lows as Q&A digested. Rate hike % for Dec FOMC remains
in upper 70%, however, March '19 hike chances around 25%.
- Heavy Tsy futures volume as rolling continued ahead March taking top step
(lead quarterly) Friday. Decent swap-tied receiving in 2s-10s. Strong 7Y auction
awarded 2.974% rate vs. 2.980% WI. Tsy cash/ylds: 2Y 99-28 (2.809%), 5Y 100-01.5
(2.863%), 10Y 100-19 (3.053%), 30Y 100-20.5 (3.339%).

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