US TSYS/SUPPLY: Preview 30Y Bond Re-Open

Senator Mitch McConnell (R-KY) and Senator Susan Collins (R-ME), the top Republican appropriator in the Senate, have appeared to rule out a third Republican reconciliation bill before the midterm elections in November. Speaking at an Air Force appropriations hearing, McConnell said, "I think it's safe to conclude there will not be another reconciliation bill. So it's really not an option." Colllins responded, "I agree with that assessment," per Anthony Adragna at Punchbowl News.

• As noted in earlier bullet (US: House To Vote On Immigration Bill, GOP Discusses Reconcilliation 3.0), the House Republican Study Committee met yesterday with CBO's Phillip Swagel, Joint Committee on Taxation's Tom Barthold, and representatives from the Heritage Foundation, the Fiscal Lab on Capitol Hill, and the Foundation for Government Accountability to discuss fiscal details of a new reconcilliation package.
• RSC Chair August Pfluger (R-TX) told Fox News a third bill could tackle "affordability, fraud, and defence along with housing, energy, and healthcare" as central components of the next legislative package.
• Department of Defense officials have suggested that President Trump's USD$1.5 trillion Pentagon request could be partially funded via reconciliation. The strategy has helped the GOP draft a much lower cost Pentagon bill, leaving around USD$350 to be funded in a party-line bill.
• If Republican appropriators conclude that reconcilliation 3.0 is unworkable, there might be a push for a defence supplemental, or expansion of the Pentagon funding bill. Such move would provoke calls for Democrats to include a parallel hike in non-defence spending. 

• Though well ahead of month end positioning - June quarterly index rebalancing could also be another factor behind equity indexes retreating to early May levels: the DJIA -0.45%, SPX emini -1%, the tech-heavy Nasdaq -1.7%.

Senate Majority Leader John Thune (R-SD) has followed House Speaker Mike Johnson (R-LA) in pledging to keep lawmakers in Washington, DC, through the weekend as Congress looks for a solution to the standoff over reauthorising Section 702 (FISA). The warrantless foreign surveillance power is set to go dark on Friday. 

• The most obvious route to resolving the standoff is for the White House to issue a statement confirming that President Trump has abandoned plans to nominate Federal Housing Director Bill Pulte as Director of National Intelligence. House Speaker Mike Johnson (R-LA) entered the White House a short time ago for a meeting with Trump to discuss the issue.
• Thune told reporters he is unsure if the White House will make a move today to end the standoff: “Somehow the White House is gonna have to figure something out that gets the Democrats back at the table.” He added, referring to a new DNI nominee, “I just don’t know the timing of when it happens."
• Thune continued, “We’ll see if that happens in the near term or if it’s something we have to wait on, but we’ve got til midnight Friday to keep the program going.” He confirmed that he'd keep senators in DC through the weekend “if it looks like there’s a potential solution in the offing.”
• Andrew Desiderio at Punchbowl News reports on X, "Even if Thune secures enough Dem votes today for FISA, he’d still need to get a time agreement to pass a 702 reauthorization by Friday night (requires unanimous consent)." Desiderio notes that Senator Ron Wyden (D-OR) is unlikely to provide unanimous consent.