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Twist Steepening Amidst Volatility On Powell

US TSYS
  • Volatility continues in Tsys, with the front end rally again back towards earlier highs seen after Powell's initial remarks, but the longer-end is holding more of its latest sell-off.
  • 2s10s have touched fresh recent highs of -20.3bps (+10bp) - highs since Sep’22 - but have since slipped to -21bps.
  • TYZ3 has plumbed new lows of 105-10+ in this turnaround, (currently 105-18). Support is seen at 105-01+ (2.0% 10-dma envelope)

  • It comes after some mixed comments from Chair Powell. Bloomberg headlines below:

*POWELL: EVIDENCE IS THAT POLICY IS NOT TOO TIGHT RIGHT NOW
*POWELL: EVIDENCE OF YOUR EYES IS ECONOMY HANDLING HIGHER RATES

*POWELL: BUSINESS LEADERS TOLD ME ECONOMY REMAINS STRONG
*POWELL: AT THE MARGIN, YIELD RISE COULD MEAN LESS NEED TO HIKE
*POWELL: NOT BLESSING ANY PARTICULAR LEVEL OF LONG-TERM RATES
*POWELL: VERY MANY SIGNS LABOR MARKET GETTING BACK INTO BALANCE

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