Yields Firm On Monday

TYM3 deals at 115-07 in line with late NY levels.

• Cash tsys finished 2-5bps cheaper across the major benchmarks. The curve bear steepened.
• A brisk pace of corporate issuance saw tsys pressured in the NY session, dealing in narrow ranges with little follow through on moves. Firmer Oil prices also added a layer of pressure.
• Earlier in the session tsys briefly recovered off session lows as Empire Manufacturing printed its lowest level since April 2020.
• There was little progress on the debt ceiling impasse as House Leader McCarthy countered positive assessments from President Biden and Tsy Secretary Yellen ahead of preliminary talks today.
• Chicago Fed President Goolsbee said that it has been a close call to vote for a hike in May. Atlanta Fed President Bostic noted he favoured keeping rates on hold but the next move is more likely to be up rather than down due to inflation pressures. Minneapolis Fed President Kashkari reiterated comments seen previously that inflation is too high and the labour market remains strong.
• The minutes from the May RBA meeting headlines in Asia. Further out we have Retail Sales, Industrial Production and Business INventories. Fed VC Barr testifies before Congress and Fedspeak from Cleveland Fed President Mester, NY Fed President Williams and Chicago Fed President Gooldsbee crosses.