MNI ASIA OPEN3Y Tails, 10Y Re-Open, CPI Focus, Geo-Pol Jitters
EXECUTIVE SUMMARY
- MNI US CPI Preview: Monthly Moderation But Still Too High
- MNI: Any Erosion of USD Reserve Status Is 'Glacial,' GFXC Says
- MNI US/IRAN: Trump Says US Must Respond to Iran Attack on US Helicopter
- MNI: US May Existing Home Sales Beats Expectations
- MNI US DATA: Weekly ADP Starts New Reporting Window On Similar Footing To ‘May’
US
MNI: Any Erosion of USD Reserve Status Is 'Glacial,' GFXC Says
The U.S. dollar will remain the global reserve currency over the foreseeable future and any shift to the yuan or euro is happening at a "glacial" pace, members of the Global Foreign Exchange Committee told MNI. “The U.S. dollar will continue to be a very important reserve currency going forward,” Gerardo Garcia, GFXC chair and general director of central banking operations at the Bank of Mexico, said in an interview Friday after the group met in Toronto. “Panelists for example describe this movement away from the U.S. dollar to other currencies as a trend that is a glacial-like movement.”
MNI STIR: ECB Set To Deliver First Hike On Thursday, BofA Like ERZ6/Z7 Flattener
We have previously noted that the most likely ECB response to the energy shock - for now - is a "measured adjustment" of policy. We read this as between 1-3x 25bp hikes this year (the first to be delivered on Thursday), with the eventual amount of tightening to be determined by incoming data. This range of outcomes combines the ECB's self-imposed need to have a reaction function that "does react" to preserve credibility, alongside the upside inflation risks stemming from the shock.
NEWS
MNI JAPAN: BoJ Halting Bond Taper Could Keep M-T Pressure On JPY
The BOJ will consider halting its quarterly reductions in bond buying from April 2027 according to matching overnight sources reports, with an updated plan to be laid out at next week's meeting alongside an expected rate hike. This would be a dovish move, keeping JGB yields artificially low, which could add to pressure on the yen over the medium-term.
MNI US/IRAN: Deal Within Days "Unlikely"
Anadolu write: "Reaching agreement to end war between US and Iran within next few days is 'unlikely' due to ongoing 'complex situation,' Pakistani government sources tell Anadolu. Sources cite Israel’s 'non-stop' ceasefire violations in southern Lebanon "
MNI US/IRAN: Trump Says US Must Respond to Iran Attack on US Helicopter
Donald J. Trump on Truth Social: I have just been informed by our Great Military that last night the Iranians shot down one of our highly sophisticated Apache Helicopters while patrolling over the Strait of Hormuz. There were two pilots involved, both are safe and uninjured. Nevertheless, the United States must, of necessity, respond to this attack. Thank you for your attention to this matter! President DONALD J. TRUMP
MNI IRAN: IDF Chief: Prepared To Strike Iran Again
"*IDF CHIEF: OUR STRIKE IN IRAN WAS PREPARATION FOR HEAVIER BLOW" Bloomberg
"*IDF CHIEF: WE ARE PREPARED TO RETURN, STRIKE IRAN AGAIN" Bloomberg
"*IDF CHIEF: IRAN'S ATTEMPT TO DICTATE NEW RULES WILL FAIL" Bloomberg
"*IDF CHIEF: WE WILL CONTINUE TO DEEPEN DAMAGE TO HEZBOLLAH" Bloomberg
US TSYS
MNI US TSYS: Tension Flares, Trump Warns Iran After Chopper Downing, CPI up Next
- Treasuries look to finish near midsession highs after some two-way geo-pol related volatility Tuesday. Sky News Arabia reported that the draft agreement has been sent to the American side for its review, with confirmation that the draft is preliminarily acceptable to the American administration.
- However, crude bounced off session lows after President Trump posted on Truth Social to say he would respond to the Iranian downing of a US helicopter, threatening to raise tensions. While it may contradict Trump’s statements earlier of progress to a deal, the US may think it can take some form of limited action without completely derailing the talks.
- Weekly ADP private employment increased an average 29.0k per week in the four weeks to May 23, slightly moderating from 30.5k in the prior week (a new value for the weekly series but one that chimed with the monthly series released instead that week) and an unrevised 35.75k the week before that.
- Focus on CPI tomorrow morning, inflation expected to moderate to a still elevated pace in May, with MNI unrounded consensus pointing to 0.51% M/M for headline CPI and 0.23% M/M for core CPI. It should see headline CPI jump further to 4.2% Y/Y with a risk of 4.3% (either strongest since Apr 2023) whilst core CPI would see a more modest acceleration to 2.8-2.9% Y/Y (strongest since Sep 2025).
- TYU6 trades +5.5 after the bell to 109-06.5 (108-27.5 low). Resistance to watch is 110-04, the 50-day EMA. The bear trigger lies at 108-08+, the May 19 low. Clearance of this level would confirm a resumption of the downtrend.
- Today's 3Y Note sale (91282CQV6) tailed slightly: 4.192% high yield vs. 4.190% WI; 2.64x bid-to-cover over the 5-auction average of 2.616x.
OVERNIGHT DATA
MNI US CPI Preview: Monthly Moderation But Still Too High
Monthly inflation is expected to moderate to a still elevated pace in May, with MNI unrounded consensus pointing to 0.51% M/M for headline CPI and 0.23% M/M for core CPI. It should see headline CPI jump further to 4.2% Y/Y with a risk of 4.3% (either strongest since Apr 2023) whilst core CPI would see a more modest acceleration to 2.8-2.9% Y/Y (strongest since Sep 2025).
MNI US DATA: Weekly ADP Starts New Reporting Window On Similar Footing To ‘May’
- Weekly ADP private employment increased an average 29.0k per week in the four weeks to May 23, slightly moderating from 30.5k in the prior week (a new value for the weekly series but one that chimed with the monthly series released instead that week) and an unrevised 35.75k the week before that.
- It leaves a latest monthly equivalent to 116k for a similar pace to the monthly ADP report for May with its 122k increase in private employment.
- As such it consolidates an improvement from the 105k in April, 61k in March and 66k in Feb even if it’s below various weekly series at an equivalent ~160k between end-March to early May.
- The BLS private payrolls has been stronger over the past three months although it’s also been much noisier since last year’s government shutdown (rising 120k in May, 177k in Apr and 202k in Mar but after a heavy decline of -148k in Feb).
MNI: US APR WHOLESALE INVENTORIES +0.6% M/M
- MNI: US APR WHOLESALE INVENTORIES +0.6% M/M
- US APR WHOLESALE SALES +2.0% M/M
MNI: US May Existing Home Sales Beats Expectations
U.S. sales of existing homes grew 3.2% to a seasonally adjusted annual rate of 4.17 million in May, the National Association of Realtors said Tuesday, above market expectations for a 4.06 million rate. Sales are also up 3.2% from a year ago. “Improving affordability is helping drive this momentum,” said Lawrence Yun, NAR chief economist. “I think this could be a breakout moment, but if the mortgage rate returns upwards, then that's kind of a hindrance."
MNI: US REDBOOK: STORE SALES +9.1% WK ENDED JUN 06 VS YR AGO WK
- MNI: US REDBOOK: STORE SALES +9.1% WK ENDED JUN 06 VS YR AGO WK
- US REDBOOK: JUN STORE SALES +9.1% VS YR AGO MO
MARKETS SNAPSHOT
Key market levels of markets in late NY trade:
DJIA down 73.76 points (-0.15%) at 50717.01
S&P E-Mini Future down 59 points (-0.8%) at 7358
Nasdaq down 403.2 points (-1.6%) at 25532.95
US 10-Yr yield is down 3.4 bps at 4.5284%
US Sep 10-Yr futures are up 5/32 at 109-6
EURUSD up 0.0007 (0.06%) at 1.1542
USDJPY up 0.24 (0.15%) at 160.4
WTI Crude Oil (front-month) down $3.14 (-3.44%) at $88.16
Gold is down $78.33 (-1.81%) at $4252.27
European bourses closing levels:
EuroStoxx 50 down 12.55 points (-0.21%) at 6049.74
FTSE 100 down 145.87 points (-1.41%) at 10227.33
German DAX down 183.16 points (-0.74%) at 24433.06
French CAC 40 up 4.14 points (0.05%) at 8203.43
US TREASURY FUTURES CLOSE
Curve update:
3M10Y -2.503, 81.844 (L: 80.453 / H: 84.17)
2Y10Y +0.162, 39.786 (L: 39.435 / H: 40.978)
2Y30Y +0.789, 87.729 (L: 86.83 / H: 89.392)
5Y30Y +0.58, 74.91 (L: 73.882 / H: 76.45)
Current futures levels:
Sep 2-Yr futures up 2/32 at 103-1.625 (L: 102-30.625 / H: 103-02.62)
Sep 5-Yr futures up 3.5/32 at 106-23.25 (L: 106-16.5 / H: 106-25.5)
Sep 10-Yr futures up 5/32 at 109-6 (L: 108-27.5 / H: 109-09)
Sep 30-Yr futures up 9/32 at 111-25 (L: 111-03 / H: 111-27.006000000001)
Sep Ultra futures up 10/32 at 114-5 (L: 113-12 / H: 114-07)
MNI US 10YR FUTURE TECHS: (U6) Resistance Remains Intact
- RES 4: 111-02+ High Apr 24
- RES 3: 110-28+ High May 7
- RES 2: 110-04 50-day EMA
- RES 1: 109-18/110-00+ 20-day EMA / High May 29
- PRICE: 109-05 @ 1405 ET Jun 9
- SUP 1: 108-25 Low Jun 08
- SUP 2: 108-08+ Low May 19 and the bear trigger
- SUP 3: 108-04 1.382 proj of Apr 17 - May 4 - 7 swing
- SUP 4: 107-29 1.618 proj of the Apr 17 - May 4 - 7 price swing
Treasuries traded lower Monday and only partially retraced those losses into the Tuesday close. Recent weakness has reinforced a M/T bearish theme and potentially provides an early signal that the corrective cycle that started May 19, is over. Note that recent gains have allowed an oversold trend condition to unwind. Resistance to watch is 110-04, the 50-day EMA. The bear trigger lies at 108-08+, the May 19 low. Clearance of this level would confirm a resumption of the downtrend.
SOFR FUTURES CLOSE
Current White pack (Jun 26-Mar 27):
Jun 26 +0.005 at 96.333
Sep 26 +0.020 at 96.205
Dec 26 +0.030 at 96.065
Mar 27 +0.035 at 95.965
Red Pack (Jun 27-Mar 28) +0.020 to +0.035
Green Pack (Jun 28-Mar 29) +0.015 to +0.015
Blue Pack (Jun 29-Mar 30) +0.010 to +0.015
Gold Pack (Jun 30-Mar 31) +0.010 to +0.010
REFERENCE RATES
US TSYS: Repo Reference Rates
- Secured Overnight Financing Rate (SOFR): 3.63% (+0.00), volume: $3.115T
- Broad General Collateral Rate (BGCR): 3.61% (+0.00), volume: $1.298T
- Tri-Party General Collateral Rate (TCR): 3.61% (+0.00), volume: $1.254T
- (rate, volume levels reflect prior session)
STIR: FRBNY EFFR for prior session:
- Daily Effective Fed Funds Rate: 3.62% (+0.00), volume: $108B
- Daily Overnight Bank Funding Rate: 3.62% (+0.00), volume: $233B
FED Reverse Repo Operation
RRP usage at $0.577B with 13 counterparties this afternoon vs. $1.832B Monday. Compares to last year's highest excess liquidity measure: $460.731B on June 30.
MNI PIPELINE: Corporate Bond Update: $13.575B to Price Tuesday
- Date $MM Issuer (Priced *, Launch #)
- 06/09 $4B *EIB 7Y SOFR+37
- 06/09 $2.45B #Tencent $1.75B 10Y +50, $700M 20Y +60
- 06/09 $1.5B *Kommuninvest 1.75Y SOFR+20
- 06/09 $1.2B Rocket Cos $600M each: 5NC2 6.25%, 8NC3 6.5%
- 06/09 $1B #DTE Energy 32NC7 6.2%a
- 06/09 $800M #ICL Group 10Y +150
- 06/09 $600M #Jackson Life National 5Y +105
- 06/09 $500M Allegiant Travel 5NC2
- 06/09 $525M #Mercury General 10Y +175
- 06/09 $500M *Korea Hydro & Nuclear 5Y +43
- 06/09 $500M #Fortitude Global Funding 5Y +130
EGBS
Closing Yields / 10-Yr EGB Spreads To Germany
- Germany: The 2-Yr yield is down 4.7bps at 4.331%, 5-Yr is down 4.4bps at 4.46%, 10-Yr is down 4bps at 4.903%, and 30-Yr is down 3.3bps at 5.591%.
- UK: The 2-Yr yield is down 4.7bps at 4.331%, 5-Yr is down 4.4bps at 4.46%, 10-Yr is down 4bps at 4.903%, and 30-Yr is down 3.3bps at 5.591%.
- Italian BTP spread vs Bunds is down 1.6bps at 75.8bps
MNI FOREX: Initial Dollar Weakness Reverses as Equities Slump
- Another round of cautious optimism on a peace deal in Iran prompted some modest weakness for the US dollar early on Tuesday, with the USD index slipping back below 100 to a session low of 99.68. However, this optimism then dissipated and as the major equity benchmarks extended to fresh pullback lows, the DXY edged back to unchanged levels on the session.
- With risk sentiment dented, Scandinavian currencies are the weakest performers across the G10, closely matched by the Australian dollar.
- For AUDUSD, spot levels around 0.7015 represent 8-week lows for the pair. The sharp sell-off on Friday highlighted a clear break of the 50-day EMA (intersecting now around 0.7120), and the break of this average has prompted a deeper retracement. The next downside levels of note are 0.6986, the Apr 13 low and 0.6938, the 76.4% retracement of the Mar 30 - May 6 bull leg.
- Relative underperformance compared to its antipodean counterpart has seen AUDNZD move 0.4% lower on the session. Potentially assisting this theme was a change of call by analysts at National Australia Bank (NAB), who no longer expect the RBA to hike by 25bp in Aug, and believe the next move for the cash rate is likely to be down.
- USDJPY made a fresh post-intervention high of 160.45 today, further narrowing the gap to the pre-intervention highs of 160.72 and placing further pressure on the MoF. The BOJ will consider halting its quarterly reductions in bond buying from April 2027 according to matching overnight sources reports. This would be a dovish move, keeping JGB yields artificially low, which could add to pressure on the yen over the medium-term.
- In emerging markets, the Peruvian sol has surged 3%, extending a sharp turnaround following Sunday’s second round runoff vote. Prediction markets lean heavily towards the market friendly candidate Fujimori prevailing.
- US CPI highlights the data calendar on Wednesday, alongside the BOC decision. Focus then shifts to the ECB decision on Thursday, where the GC is expected to deliver a 25bp hike.
WEDNESDAY DATA CALENDAR
| Date | GMT/Local | Impact | Country | Event |
| 10/06/2026 | 0600/0800 | ** |  SE | Private Sector Production m/m |
| 10/06/2026 | 0600/0800 | *** |  NO | CPI Norway |
| 10/06/2026 | 0700/0300 | *** |  CZ | Czech Republic Final CPI |
| 10/06/2026 | 0800/1000 | * |  IT | Industrial Production |
| 10/06/2026 | 1100/0700 | ** |  US | MBA Weekly Applications Index |
| 10/06/2026 | - |  EZ | European Central Bank Meeting | |
| 10/06/2026 | - |  CA | Bank of Canada Meeting | |
| 10/06/2026 | - | *** |  CN | Money Supply |
| 10/06/2026 | - | *** | CN | New Loans |
| 10/06/2026 | - | *** | CN | Social Financing |
| 10/06/2026 | 1200/0800 | * | US | NY Fed SOFR |
| 10/06/2026 | 1230/0830 | *** | US | CPI |
| 10/06/2026 | 1230/0830 | *** | US | CPI |
| 10/06/2026 | 1230/0830 | *** | US | CPI |
| 10/06/2026 | 1230/0830 | *** | US | CPI |
| 10/06/2026 | 1230/0830 | *** | US | CPI |
| 10/06/2026 | 1300/0900 | * | US | NY Fed EFFR |
| 10/06/2026 | 1345/0945 | *** | CA | Bank of Canada Policy Decision |
| 10/06/2026 | 1430/1030 | CA | BOC press conference | |
| 10/06/2026 | 1430/1030 | ** | US | US DOE Petroleum Supply |
| 10/06/2026 | 1430/1030 | ** | US | DOE Weekly Crude Oil Stocks |
| 10/06/2026 | 1700/1300 | ** | US | US Note 10 Year Treasury Auction Result |
| 10/06/2026 | 1800/1400 | ** | US | Treasury Budget |
| 10/06/2026 | - |  TR | Central Bank of Republic of Turkiye Meeting |
