TREASURIES SO FAR: Mild bid ahead of Powell and ISM

BLOCKS

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OI CHANGES

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  Futures (H4): ZT +69k (+1.68%), ZF +9k (+0.15%), ZN -41k (-0.89%), TN +31k (+1.57%), ZB +5k (+0.40%), UB +22k (+1.37%).


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Analysis details (13:29)

T-Notes (H4) up 6+ ticks at 109-31+ in a 109-25+/110-04 range on strong volumes. 

CASH YIELDS: 2yr -3.0bps at 4.685%, 5yr -3.7bps at 4.261%, 10yr -3.0bps at 4.32%, 30yr -2.2bps at 4.489%.

SO FAR: Treasuries have been choppy and rangebound so far on Friday ahead of Chair Powell and the ISM survey. T-Notes have been dancing on either side of 110, fading beneath after the hot Chinese PMI data, whilst eclipsing the round level again in the London morning to mark a session high of 110-04. However, contracts faded to session lows of 109-25+ at the NY handover despite WSJ's Timiraos' comment that Fed hikes are probably over, but officials are reluctant to say so. Stateside trade so far seen a lack of appetite to sustain the moves lower with contracts rangebound and yields across the curve lower by a few bps. 

Citi says, "Our Asia desk notes the key theme has been de-risking ahead of Powell speech. CTAs are flipping long in 2s, 5s, and 10s, but there is room for more inflows." On Powell, Citi says, "any reiteration of "higher for longer" would send yields and USD higher, which we should ultimately fade." 

FRIDAY: Canadian Jobs (Nov) at 08:30ET, S&P Manufacturing PMI at 09:45, ISM Manufacturing (Nov) and Construction Spending (Oct) at 10:00, Powell at 11:00, and Powell and Cook together at 14:00. 

FED SPEAK:

• 10:00ET: Goolsbee (2023 voter, dove) Q&A at Chicago Fed's Annual Economic Outlook Symposium.


• 11:00ET: Powell participates in fireside chat at Spelman College.


• 14:00ET: Powell and Cook (voter) participate in roundtable to hear from local leaders in the tech innovation and entrepreneurship community during visit to Spelman College.

01 Dec 2023 - 13:29- Fixed IncomeData- Source: Newsquawk/CME