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What to Watch

US TSYS
  • Late overnight support in short to intermediate rates evaporated in the last few minutes, curves off reverse course, turn (2Y10Y -2.037 at -76.492). No obvious headline driver or block/cross noted though volumes did climb: TYU3 over 325k at the moment. SPX emini futures have also reversed earlier gains (ESU3 -1.25 at 4479.50.
  • Rate hike projection through year end gains slightly: November cumulative of +10.1bp vs. +9.6bp earlier at 5.430, December cumulative of +8.6bp vs. 6.7bp at 5.415%. Fed terminal climbs to 5.43% in Nov'23.
  • No data today, just Tsy bill auctions today ($69B 13W, $62B 26W Bill auctions). Data resumes Tuesday with Retail Sales, import/export index and TIC flows. Minutes for July FOMC this Wednesday.
  • According to Punchbowl, “House Republicans have a conference call tonight at [18:00 ET 23:00 BST] to discuss FY2024 government funding, the thorniest issue they’ll face this fall [and] Speaker Kevin McCarthy [R-CA] is hosting his annual retreat in Jackson Hole, Wyo., this week.”

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