TREASURY WRAP: T-NOTE FUTURES (H6) SETTLE 1 TICK LOWER AT 112-07

Analysis details (20:32)

T-notes flatten after NFP while SCOTUS avoids ruling on Trump tariffs for now. At settlement, 2-year +4.4bps at 3.538%, 3-year +3.7bps at 3.593%, 5-year +2.5bps at 3.753%, 7-year +1.8bps at 3.955%, 10-year +0.2bps at 4.171%, 20-year −1.4bps at 4.767%, 30-year −1.8bps at 4.820%.

THE DAY: The Treasury curve flattened on Friday in wake of the NFP report, with front-end yields rising as the jobs report showed no need for imminent rate cuts, seeing markets completely unwind any rate cut bets for January. However, the long-end of the curve saw yields lower on the session with the moves seen in wake of the SCOTUS announcing it will not rule on Trump's tariff ruling today, with long-end yields extending lower into settlement. The SCOTUS also announced it may be issuing opinions next Wednesday, so this may be another opportunity for markets to get clarity on whether Trump's IEEPA tariffs can go ahead. Elsewhere, the UoM prelim January survey came in above expectations with the inflation expectations unchanged for the year-ahead but rose to 3.4% from 3.1% in the 5-year horizon. Fed speak saw remarks from Bostic (retiring), who expressed concern about the inflation side of the mandate, while Barkin said the drop in unemployment was welcome, but job growth is modest. Attention next week turns to 3-, 10- and 30-year supply early in the week, US CPI, and US Retail Sales. 

SUPPLY

Notes

• US Treasury to sell USD 58bln of 3yr notes on Jan 12th, USD 39bln of 10yr notes on Jan 12th and USD 22bln of 30yr bonds on Jan 13th (as expected); all to settle Jan 15th

Bills

• US to sell USD 86bln of 13-week bills and USD 77bln of 26-week bills on Jan 12th.


• US to sell USD 75bln of 6-week bills on Jan 13th.

STIRS/OPERATIONS

• Market Implied Fed Rate Cut Pricing: January 0bps (prev. 2bps), March 7bps (prev. 10bps), April 11bps (prev. 16bps), December 50bps (prev. 58bps)


• NY Fed RRP op demand at USD 3.28bln (prev. 3.1bln) across 6 counterparties (prev. 7)


• EFFR at 3.64% (prev. 3.64%), volumes at USD 87bln (prev. 83bln) on January 8th.


• SOFR at 3.64% (prev. 3.65%), volumes at USD 3.249tln (prev. 3.267tln) on January 8th

09 Jan 2026 - 20:32- ForexGeopolitical- Source: Newsquawk