US TSYS: Narrow Ranges In Asia
TYU3 deals at 113-04+, -0-03, a touch off the base of the narrow 0-05 range on volume of ~49k.
- Cash tsys sit little changed across the major benchmarks.
- Tsys have been marginally pressured through the Asian session after the PBOC fixed the Yuan 100 pips stronger than forecast which weighed on the USD. However recent ranges have been respected thus far.
- Early in the session tsys were a touch firmer as Asia-Pac participants 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.
- FOMC dated OIS price a terminal rate of 4.30% in November. There are ~70bps of cuts priced for 2024.
- There is a thin docket in Europe today. Further out we have a slew of US data including US new home sales, durable goods and Conference Board consumer confidence. We also have the latest 5-Year Supply.
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US: Debt Ceiling Deal Has Been Reached
NY Times reported negotiators reached a deal "in principle to raise the debt limit for two years while cutting and capping some government spending over the same period, a breakthrough after a marathon set of crisis talks that has brought the nation within days of its first default in history, three people familiar with the agreement said."
JGB TECHS: (M3) Corrects Lower
- RES 3: 151.26 - High Mar 3 2022
- RES 2: 149.75/150.81 - High Nov 11 / High Aug 5 2022
- RES 1: 149.53 High Mar 22
- PRICE: 148.53 @ 16:25 BST May 26
- SUP 1: 147.31/27 - 50-day EMA / Low Apr 18
- SUP 2: 145.80/144.73 - Low Mar 13 / Low Feb 13
- SUP 3: 144.15 - Low Jan 13
JGBs slid sharply Thursday, as hawkish Ueda comments prompted a correction. The bounce Friday helped stall any more protracted pullback, although the gap with next resistance at 149.17 remains. The strong recovery from 147.27, the Apr 18 low confirms the corrective nature of the recent pullback, keeping medium-term attention on 149.53, the Mar 22 high and the bull trigger. A break of this level would confirm a resumption of the uptrend. To the downside, the 50-dma provides support at 147.31, just above the Apr 18 low.
MNI: TREASURY GENERAL ACCOUNT $38.8B MAY 25 VS $49.5B PREV DAY
- MNI: TREASURY GENERAL ACCOUNT $38.8B MAY 25 VS $49.5B PREV DAY
