US TSYS: Firms Off Session Lows
Tsys have firmed off session lows, the move came alongside an uptick in e-minis and the USD marginally retreating from session highs. There was no overt macro headline driver. This leaves cash tsys little changed across the major benchmarks. TYU3 deals at 111-31, -0-05+, at the top of the 0-04+ range.
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JGBS: Futures Slightly Lower Ahead Of 20-Year Supply, Local Calendar Light
JGB futures are slightly cheaper in early Tokyo trade, -3 compared to settlement levels, after closing virtually unchanged in overnight trade.
- Cash tsys have opened dealing 1-2bps richer across the major benchmarks, light bull steepening is apparent. Asia-Pac participants have faded yesterday's issuance-induced retreat from session highs seen early in the NY session, perhaps using the opportunity to enter fresh long positions/close shorts.
- The local calendar is light today with the release of Coincident & Leading Indicators for April (final) as the highlight.
- The data calendar is also light in Asia.
- Cash JGBs are mixed across the curve yield movements within a -0.6bp to +0.8bp range. The benchmark 10-year yield is 0.5bp higher at 0.366%, below the BoJ's YCC limit of 0.50%.
- The 20-year zone is trading 0.1bp lower at 0.954%, showing no concession on the curve, ahead of today's supply.
- The swap curve bear steepens with rates 0.1-1.5bp higher. Swap spreads are wider beyond 1-year.
US TSYS: Richer Start
Cash tsys have opened dealing 1-2bps richer across the major benchmarks, light bull steepening is apparent. Asia-Pac participants have faded yesterday's issuance-induced retreat from session highs seen early in the NY session, perhaps using the opportunity to enter fresh long positions/close shorts. TYU3 deals at 113-07+, unchanged from Monday’s settlement levels.
- A thin data calendar leaves participants on headline watch.
AUDNZD: Holding Below 200-Day EMA
AUD/NZD has now trimmed the entirety of the gains seen after the RBA hiked the cash rate early in the month, we last print at $1.0825/35.
- The pair is down ~2% from the high on June 19 and fell below the 200-Day EMA yesterday and has been holding below the measure in early dealing today.
- Bears first look to break the $1.08 handle, from here they can target the low from May 26 ($1.0708).
- On the upside bulls immediate focus is on the 200-Day EMA ($1.0849), from here they can target the 20-Day EMA ($1.0909).
- Tomorrow's May CPI print from Australia presents the next event risk, CPI is expected to tick lower to 6.1% Y/Y from 6.8% prior.
