UK DMO UPDATE: Long gilts: Syndication announced; litmus test tender next week

Treasuries have seen a quiet overnight session in narrow ranges ahead of a busy docket headlined by the first FOMC decision under Fed Chair Warsh. There is also notable data with the May retail sales report before Trump gives a press conference at 0930ET on his last day in France, including details of the Iran deal. 

• Cash yields are 0.4-0.9bp lower on the day.
• TYU6 trades at 109-29 (-01) on particularly light cumulative volumes of 205k.
• It has traded within a 4 tick range since the Asia open as it continues to hold slightly below yesterday’s high of 110-00 after those latest gains were helped by further crude oil declines on reports Iran will be able to sell its oil immediately.
• There appears to be sizeable resistance at this level, with 110-00 also Monday’s Asia high in response to the weekend US-Iran agreement as well as the 50-day EMA along with 110-00+ for the May 29 high.
• A clear break of this hurdle would undermine the bear theme and signal scope for a stronger recovery, with next resistance seen at 110-14 (Fibo retrace of Mar 2 – May 19 bear leg).
• Data: Weekly MBA (0700ET), Retail sales May (0830ET), Business inventories Apr (1000ET), Pending home sales May (1000ET)
• Fed: FOMC decision/SEP (1400ET), Warsh press conference (1430ET)
• Bill issuance: US Tsy to sell $69bn 17w bills (1130ET)
• Politics: Trump in G7 leaders working session (0630ET), Trump in working lunch with Modi (0845ET), Trump holds press conference (0930ET), Trump in bilateral dinner with Macro (1300ET) before departing at some point for the White House

“*TRUMP: OIL PRICES MIGHT GET LOWER THAN BEFORE THE WAR” BBG

“*TRUMP: REPORT ON $300B FUND IS FALSE” BBG
“*TRUMP: US NOT HAVING A FUND TO INVEST IN IRAN” BBG

 “*TRUMP: IRAN MOU IS NOT FINAL” BBG
“*TRUMP: IF I DON'T LIKE WHAT I SEE, WE'LL STRIKE AGAIN” BBG

 

“*TRUMP: TO DISCUSS IRAN DEAL DETAILS AT PRESS CONFERENCE TODAY” BBG

 “*TRUMP: STRAIT OF HORMUZ WILL BE OPEN IN NEXT DAY OR TWO” BBG

“*TRUMP: OIL PRICE IS COMING DOWN” BBG

“*TRUMP: STRAIT ALREADY PARTIALLY OPEN, WILL OPEN IN FULL” BBG