AUSSIE 10-YEAR TECHS: (M5) Bear Cycle Remains Intact For Now

TYM5 reopens at 110-22, down -0-03 from closing levels in today’s Asia-Pac session.

• Overnight US 10-year yields had a range of 4.3695% - 4.4341%, closing around 4.40%.
• Treasury yields finished mixed Tuesday, curves unwinding a large portion of Monday's steepening with bonds outperforming the short end(2s10s - 6.24 at 57.965).
• (Bloomberg) -- “Treasury’s $69 billion auction of two-year notes was awarded at 3.795%, lowest result since September, vs 3.789% when-issued yield at the bidding deadline of 1 p.m. New York time, despite cheapening by about 5bp into the sale.”
• Treasury Secretary Bessent Tuesday privately told investors the tariff standoff is unsustainable and he expects de-escalation with China.
• 10-year Yields, having bounced off their support around the 4.25 area, are consolidating and the range looks to be 4.25/4.50% for now.

FX markets are reacting early to Trump remarks made in the oval office a short while ago.

•  USD/JPY is up around 0.60%, last near 142.40/45, while EUR/USD is down around 0.40%, last close to 1.1375. AUD/USD is the only G10 currency marginally higher versus the USD, up 0.10% to 0.6370/75. The ETF for the S&P500 is up 2% in post market trade (per BBG).
• These moves come after US President Trump stated that he had no intention of firing Fed Chair Powell (which has been a cause of concern recently and around the outlook for Fed Independence). Such fears were a further weight on broader US asset related sentiment.  
• Trump also stated that the final tariff number for China wouldn't be near the current 145%. He also expressed optimism around trade deals with lots of countries and spoke of the large investment agreements reached for flows into the US.
• USD/CNH is lower, off around 0.15% to the low 7.3000 region. 

Bloomberg reported that there was a significant US crude stock drawdown of 4.57mn barrels with 354k at Cushing last week, according to people familiar with the API data. Products continued their decline with gasoline down 2.18mn and distillate 1.64mn. The official EIA data is out later today.