US TSYS: Modest Bear Steepening

Treasuries closed Wednesday flat, having traded throughout the session well within the week's ranges amid a lack of major catalysts.

• Late in the session, the December TY contract was up 1.5 ticks at 114-01+, near the low end of the day's 8 tick range (114-01 to 114-09). The subdued price action contrasted with fairly sharp moves for equities throughout the session on tech stock volatility, as well as notable US dollar strength (DXY +0.6% for one of its strongest sessions of the summer).
• The cash curve leaned bear steeper: the 2-Yr yield is up 1.6bps at 3.8733%, 5-Yr is up 2.1bps at 3.6688%, 10-Yr is up 2.3bps at 3.8444%, and 30-Yr is up 2.1bps at 4.1338%.
• Data was limited: MBA mortgage applications showed flat weekly growth, while the re-started Atlanta Fed Wage Tracker provided further evidence of gradually softening labor market conditions.
• There was little reaction to the $70B 5Y Note auction which went relatively smoothly, with a 0.3bp tail offset by strong peripheral statistics.
• Overnight, attention will be on chipmaker Nvidia's earnings results after the market close, an appearance by Atlanta Fed Pres Bostic, and German inflation data early Thursday morning.
• Thursday's data calendar includes US GDP revisions and weekly jobless claims, as well as the final Treasury coupon supply of the month in the form of 7Y Note.