TY Clears Support, Curve Bear Steepens

TYZ3 deals at 105-26, -0-02, in line with late NY levels. On Wednesday support at 106-03+ was firmly cleared, the next downside level is 105-05+ the 2% DMA Envelope.

• Cash tsys finished 1-8bps cheaper, the curve bear steepened.
• Tsys extended recent losses with the steepening impetus seen in recent sessions continuing with Gaza aid headlines aiding at the margins.
• There were several Fed speakers yesterday, Gov Waller provided hawkish remarks noting robust super-core inflation is not at a level where the Fed can make progress towards its inflation goals. He also said additional tightening would be required if the economy continues to show underlying strength and inflation stabilises or re-accelerates.
• NY Fed President Williams reiterated comments seen in previous Fed communique that there is still a way to go on inflation and rates will need to remain restrictive for some time.
• There was a brief recovery after the latest 20-Year Auction stopped through however the move didn't follow through and tsys ticked towards session lows into the close.
• The Australian Labour Market Report for September provides the highlight in Asia, further out Fedpseak from Chair Powell headlines we also have Initial Jobless Claims and the Philadelphia Fed Business Outlook.