January 30, 2023 23:17 GMT
Yields Firm On Monday, Fed Meeting In View
TYH3 deals at 114-13, +0-04, in with late NY Levels.
- Cash Tsys finished Monday 3-5bp cheaper across the major benchmarks.
- Pressure on EU FI, as Spanish CPI was higher than expected (although muddied by methodology tweaks), spilled over onto Tsys in the European session.
- The Dallas Fed Manf Activity printed stronger than exp., however the measure is still in contractionary territory.
- Tsys firmed off lows in the NY session, respecting tight ranges, with pre-Fed positioning dominating.
- A late block buy in TY futures (+10K) aided the move away from lows, although a block sale in TU futures (-9,151) helped cap the bid.
- Ahead of Wednesday's Fed meeting OIS markets are steady, pricing in a ~26bp hike for the event, alongside a terminal rate of ~4.93% which is below the Feds dot plot median of 5.10%.
- Official PMI data from China headlines the Asia-Pac session. Further out Eurozone GDP and U.S. consumer confidence will cross the wires.