US TSYS
- It has been another slow session for tsys so far, futures are trading with the prior days ranges, while most trading seems to be around futures rolls. TU is -00¼ at 102-19¾, while TY is trading +00+ at 109-22+.
- The belly of the curve is slightly outperforming today, with the 2s7s30s fly -1bp at -24bps, now the lowest since Nov 11th. The 2yr is -0.6bps at 4.308%, while the 10yr is trading -1.2bps at 4.398%.
- The 10yr has spent the past week trading in a narrow range, having failed to break above 4.50% on multi occasions, while the 2s10s has been rangebound since early Oct.
- Projected rate cuts have receded slightly this week vs Friday close (*): Dec'24 cumulative -13.0bp (-14.5bp), Jan'25 -20.0bp (-23.1bp), Mar'25 -34.0bp (-37.6bp), May'25 -41.6bp (-45.3bp).
- Earlier this morning the Fed's Collins earlier emphasized the need for additional interest-rate cuts but advocated a cautious and deliberate approach to avoid missteps, she also stated that while policy remains somewhat restrictive, current adjustments give the FOMC flexibility to assess risks to inflation and employment. She highlighted that inflation is progressing toward the 2% target, though unevenly, and noted the labor market remains healthy despite concentrated job growth
- Focus now turns to Philadelphia Fed Business Outlook, Jobless Claims, Leading Index & Existing Home Sales later today, while we also have Fed speakers including Hammack, Goolsbee, Schmid & Barr
Chart. 2s10s Curve Rangebound
227 words