US FISCAL: Strong Tax Receipts Keep TGA Elevated
Tax receipts before and since the April 15 deadline have been very healthy, with the running 12-day total (Apr 8 - 23) tax collection up to $565.5B, up $111B from 2024's haul over the equivalent period. This included a large jump in individual tax collection yesterday ($74B).
- The Treasury General Account pulled back in size yesterday by $30B to $576B, off the recent beak set two days prior at $626B. However this is typical seasonality for the TGA and the accumulated increase of around $300B over tax season to date compares favorably to previous years.
- As such, the April tax season should allay concerns that the "x-date" for Treasury will arrive earlier than may have been feared in the case of weaker tax receipts. We expect to hear more from Treasury as soon as next week on its latest guidance for when the "x-date" may be reached.
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US DATA: House Prices Continue To Grow At Robust Pace
Data out Tuesday showed house prices were a little firmer than expected in January per the S&P CoreLogic 20-City measure (0.46% M/M SA, vs 0.40% expected and 0.54% prior), though slightly on the soft side in the FHFA (0.2% vs 0.3% survey, offset by an 0.1pp upside revision to December to 0.5%).
- House price growth remains closely clustered in the 5% annual area - that's true looking at either 3M annualized rates or Y/Y readings for FHFA or S&P CoreLogic price indices.
- That's a cooler pace of growth than the well-into-double-digit readings of a few years ago, but prices continue to set new all-time highs on the above metrics, and price gains are running ahead of inflation.
- Continued house price appreciation, even amid limited price discovery as existing home sales remain low, continue to bolster household balance sheets, giving the Fed one less reason to want to ease policy.
EURJPY TECHS: Support Remains Intact
- RES 4: 165.43 High Nov 8
- RES 3: 164.90 High Dec 30 ‘24 and a key medium-term resistance
- RES 2: 164.55 High Jan 7
- RES 1: 164.19 High Mar 18 and the bull trigger
- PRICE: 161.91 @ 16:19 GMT Mar 25
- SUP 1: 160.74 Low Mar 20
- SUP 2: 160.28 50-day EMA
- SUP 3: 158.90 Low Mar 10
- SUP 4: 158.00 Round number support
A recent sell-off in EURJPY appears corrective and has allowed an overbought trend condition to unwind. Short-term pivot support to watch is 160.37, the 50-day EMA. A break of this level would signal potential for a deeper retracement. Recent gains resulted in a print above resistance at 164.08, the Jan 24 high. A clear break of this hurdle would strengthen a bullish condition and open 164.90, the Dec 30 ‘24 high.
US TSYS: Tsys Consolidate, Consumer Confidence Dips, Fed Gov Kugler Wait & See
- Treasuries look to finish modestly higher, holding a narrow range since midday after gradually recovering from this morning's opening lows.
- Tsy futures pared losses after Philly Fed non-mfg index comes out much lower than prior -32.5 vs. -13.1. Futures extended gains after Conf. Board Consumer Confidence came out lower than expected, New Home Sales dipped but up-revision of prior more than made up for the move.
- Fed Gov Kugler (permanent FOMC voter)'s overall view on rates is unsurprisingly very similar to pre-FOMC and the Committee's overall signaling of a wait-and-see stance on rate moves
- Little react to this afternoon's $69B 2Y note auction (91282CMV0), in-line with 3.984% high yield vs. 3.985% WI.
- Tsy Jun'25 10Y futures trade 110-23.5 (+6) vs. 110-26 high, initial technical resistance well above at 111-17.5/25 (High Mar 20 / 11). Curves still steeper but off earlier highs: 2s10s +.296 at 29.876 (31.698 high), 5s30s +2.459 at 59.074 (59.800 high).
- Cross asset roundup: Bbg US$ index receded (-1.21 at 1270.55), Gold trades +8.0 at 3019.04, stocks near steady (SPX Eminis) to mildly mixed, the tech-heavy Nasdaq mildly higher.
- Wednesday focus on Durables/Cap Goods at 0830ET, Tsy 5Y Sale at 1300ET, Fed Speak: MN Fed Kashkari Fed listens event (no text, Q&A) at 1000ET, StL Fed Musalem on economy/policy (text, Q&A) at 1310ET.
