CNH: USD/CNH - Tries To Bounce As PBOC Pushes Back

US bond futures all finished lower at the close of the US session, with the 10-Yr down -05 to 112-11.  As equities had another good night, bonds sold off futures finished near late Monday lows, light volumes (TYH6 705k) on narrow ranges at the start of the shortened Christmas holiday week: early close Wednesday at 1315ET, Thursday Closed, full session Friday.  TYH6 is wedged between topside resistance from the 100-day EMA of 112-14+ and downside resistance from the 200-day EMA at 111-30+.  TYH6 has opened the Asia trading day flat at 112-11.  

• The 2-Yr is up +2.3bps at 3.509%
• The 5-Yr is up +1.9bps at 3.714%
• The 10-Yr is up +1.8bps at 4.167%
• The 30-Yr is up +1.2bps at 4.838%

• The US$69bn  2Y note auction (91282CPS5) tails: 3.499% high yield vs. 3.497% WI; 2.58x bid-to-cover vs. 2.68x prior.
• The Dallas Fed's Weekly Economic Index (WEI) indicated growth of 2.29% Y/Y (scaled to 4-quarter growth) in the week of Dec 13, same as the prior week but bringing the 13-week moving average down slightly to 2.24%.
• The Census Bureau has announced the next schedule for a raft of data releases, with the highlight being November retail sales set for Jan 21 in a combination of release dates that will push back potential timing for GDP/PCE updates. We had thought PPI (Jan 14)/import prices (Jan 15) might be the stumbling block for a November PCE report but retail sales are now a clear limiting factor.
• Projected rate cut pricing cooled vs. early US morning levels (*): Jan'26 at -5bp (-5.5bp), Mar'26 at -14.3bp (-15.1bp), Apr'26 at -21.5bp (-22.5bp), Jun'26 at -34.1bp (-35.3bp).
• A Reuters headline suggests that President Trump could name a new FED Chair by the first week in January. 

• RES 3: 95.982 - 76.4% retracement Sep’24 - Nov’24 downleg
• RES 2: 95.960 - High Apr 7 (cont.)
• RES 1: 95.900 - High Oct 17
• PRICE: 95.160 @ 15:18 GMT Dec 22
• SUP 1: 95.120 - Low Dec 10
• SUP 2: 95.087 - 2.0% Lower Bollinger Band
• SUP 3: 94.276 - 1.0% 10-dma envelope

Aussie 10-yr futures remain well toward the bottom of the recent range, having taken out all major support levels in the process. With 95.275 cleared, prices are pushing to new contract lows, opening vol-band support through 95.087 and into 94.276. Any recoveries need to break back above 95.900 to signal near-term bullish traction.

Aussie bond futures are little changed in the first part of Tuesday dealing. 10yr futures (XM) were last around 95.15, while 3yr (YM) at 95.76 was also little changed versus end Monday levels. This is a modest outperformance trend relative to US Tsy futures softness for Monday's session. Some dovish remarks from Fed Governor Miran (in relation to recent data) didn't impact sentiment much. US Tsy yields finished up around 1-3bps for Monday, led by the front end. ACGB yields are little changed so far today, but this does follow strong gains in yield terms yesterday. Local focus today is on the RBA minutes from the Dec policy meeting outcome. 

• Both 3yr and 10yr futures remain within recent ranges, although the 10yr is closer to recent lows. From a technical standpoint, Aussie 10-yr futures remain well toward the bottom of the recent range, having taken out all major support levels in the process. With 95.275 cleared, prices are pushing to new contract lows, opening vol-band support through 95.087 and into 94.276. Any recoveries need to break back above 95.900 to signal near-term bullish traction.
• The 3yr outright ACGB yield is close to 4.155% little changed, while the 10yr is just under 4.80% (which is around recent highs for this benchmark). The AU 3/10s curve is steady near +63bps, while the AU-US 10yr differential is holding close to recent highs, last +64bps.
• For the RBA Minutes today, Governor Bullock said in the December press conference that 2026's discussions are likely to be around whether to leave rates at 3.6% or increase them, as the Board is uncomfortable with where inflation currently is. This suggests that the RBA's stance is skewed to the upside. The minutes will be scrutinised for more information around this and the degree of concern about upside inflation risks.
• For the Feb policy meeting the market implied rate is around 3.69%, which has been relatively steady in recent weeks.