STIR: US Fed Rate Path Extends Climb After US-UK Trade Pact

Tsy futures remain weaker but off midmorning lows ahead of the $58B 3Y note auction (91282CMW8) at 1300ET, WI is currently at 3.775%, 13.3bp rich to last month's auction. Auction results will be available shortly after the competitive auctions closes at 1300ET.

• March auction recap: Treasury dipped slightly post auction, the $58B 3Y deemed very solid despite a modest 0.6bp tail: high yield 3.908% vs when-Issued yield of 3.902% at auction cutoff.
• Bid-to-cover ratio likewise dipped slightly to 2.70x from February's post-2023 high 2.79x, but this was still the 2nd highest cover since 2023.
• The tail was in-line with recent auctions (0.3bp average in previous 5 sales including January's strong 1.2bp trade-through), and came despite a lack of significant concession going into the auction.
• Peripheral stats: indirect take-up 62.5% vs. 64.18% prior; direct bidder take-up 26.0%; primary dealer take-up 11.5%.

• EUR/USD: Apr10 $1.0900-10(E2.6bln), $1.0935-50(E2.4bln); Apr11 $1.0950-60(E1.1bln), $1.1000(E1.3bln)
• USD/JPY: Apr09 Y147.40-50($1.1bln); Apr10 Y143.00($1.3bln)
• EUR/GBP: Apr09 Gbp0.8405-20(E1.1bln)
• AUD/USD: Apr10 $0.6400(A$1.3bln)
• USD/CAD: Apr10 C$1.4395-00($1.5bln); Apr11 C$1.4045($1.6bln)
• USD/CNY: Apr10 Cny7.4000($1.4bln)

• US Data/Speaker Calendar (prior, estimate)
• 09-Apr 0700 MBA Mortgage Applications (-1.6%, --)
• 09-Apr 1000 Wholesale Inventories MoM (0.3%, 0.4%)
• 09-Apr 1000 Wholesale Trade Sales MoM (-1.3%, 0.8%)
• 09-Apr 1100 Richmond Fed Barkin at Economic Club Washington
• 09-Apr 1130 US Tsy $60B 17W bill auction
• 09-Apr 1300 US Tsy $39B 10Y note re-open (91282CMM0)
• 09-Apr 1400 FOMC Meeting Minutes for March meeting