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Tiptoeing Toward The Exit


Treasuries are trading flat on New Year's Eve, within very limited ranges and predictably little volume (Europe mainly closed for trading and Tsys didn't trade in Tokyo hours due to holiday). Not really any macro catalysts overnight.

  • The 2-Yr yield is unchanged at 0.1211%, 5-Yr is unchanged at 0.3671%, 10-Yr is up 0.3bps at 0.9265%, and 30-Yr is up 0.7bps at 1.6629%.
  • Mar 10-Yr futures (TY) down 0.5/32 at 137-30.5 (L: 137-29.5 / H: 138-00), <70k volume.
  • Jobless claims data (0830ET) the only item of note on the calendar as the year winds up, with the New Year's holiday observed Friday.
  • An early close for Tsy trading, though equities open as usual (futures a little higher).
  • More interesting has been dollar weakness to end the year; though we're off lows, China announced that it is reducing the weighting of USD in its currency basket that helps it set the yuan's daily reference rate.
  • In supply, $65B of 4-/8-week bills at 1000ET. No NY Fed buys until Jan 4.

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