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Yields Recede on Late Positioning Ahead Friday's Feb Employ Data

US TSYS
  • Tsy futures are climbing off a lower, narrow range over the last hour - TYM4 near middle of the range at 111-20 (+4.5) vs. 111-27 high.
  • Late support not headline driven - more flow driven as accts square up ahead tomorrow's Feb employ report, with trading desks reporting some renewed real$ buying in 30s. Note, however, curves remain steeper (2s10s +3.023 at -42.136).
  • Tsys rallied through technical resistance this morning after lower than expected Unit Labor Costs (0.4% vs. 0.7% est). Weekly jobless claims largely in line: (216k vs. 217k est) while Continuing Claims rise (1.906M vs. 1.880M est; prior down-revised to 1.898M from 1.905M)). Additional data: Nonfarm Productivity (3.2% vs. 3.1% est); Trade Balance (-$67.4B vs. -$63.5B est).
  • No new insight from Fed Chairman Powell today as he repeated yesterday's policy testimony to Congress.
  • Later this evening: President Biden's State of the Union Address at 2100ET.
  • Friday Data Calendar: February Employment Report.

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