Weaker After Debt Ceiling Passes The House, Heavy Calendar Ahead

TYU3 is currently trading at session lows at 114-04+, down 10+ from the closing levels in NY. While China's Caixin PMI comfortably exceeds the expansion/contraction threshold at 50.9, the main factor behind the move away from session highs was the news that the US House of Representatives voted in favour of raising the US debt ceiling by a margin of 314-117.

• The bill now awaits consideration in the Democrat-led Senate. President Biden has urged it to pass the agreement as soon as possible. However, several senators have indicated their intention to delay the legislation's progress, according to Bloomberg reports.
• Following the announcement, US tsys have weakened, reversing the earlier 1-3bp rally observed during the early Asia-Pacific session and turning into a 3-4bp cheapening across the yield curve, extending up to the 10-year maturity.
• Today’s agenda is also filled with important US data releases, including the ADP Employment report, ISM Manufacturing Index, final figures for Unit Labour Costs and Productivity in Q1, Challenger Job Cuts, and weekly Initial Jobless Claims. These releases will set the stage for Friday's highly anticipated Non-Farm Payrolls report.