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What to Watch: Weekly Claims, Crude Bounce, Yen Rally

US TSYS
  • Tsy futures weaker but off lows after marking new 3M highs in TYH4 overnight (111-09.5) currently trades 110-29 (-7.5). Curves recovering slightly from midweek flattening (3M10Y +5.649 at -125.401, 2Y10Y +2.647 at -46.451).
  • That puts rates near the upper half of the week's range ahead this morning's weekly claims data at 0830ET followed by Wholesale Trade Sales/Inventories at 1000ET.
  • Main focus on Friday's headline employment data for November after this week's lower than expected JOLTS and ADP data rekindled early 2024 rate cut projections.
  • Cross asset summary: Crude mildly bid after WTI fell below $70/bbl for the first time since early July, currently +0.54 at 69.93; Gold +7.70 at 2033.25; SPX eminins +4.0 at 4560.0; Japanese Yen extends rally, 30Y bond sale lowest bid/cover in eight years amid hawkish rate hike expectations from the BOJ on December 18.
  • US Treasury to auction $80B 4W and $80B 8W bills at 1130ET.

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