Reply To: Bond Traders Weekly Outlook: Key 2s10s Treasury Spread Compressed 50% In Second Quarter


U.S. Treasuries higher start looking for a continuation of their rally from Friday.

Treasury futures rally accelerated once the focus shifted to action in Europe. European Central Bank policymakers are increasingly concerned about second-round effects of inflation and a wage-price spiral taking hold. Bank for International Settlements called for more rate hikes, warning that the fight against inflation is at a critical juncture.

There were reports of a coup attempt by the Wagner Group in Russia, but the group’s leader reportedly accepted a deal to move to Belarus. Economic data released overnight showed Germany’s Business Climate Index from the ifo falling to its lowest level of the year while the U.S. session will not feature any data. However, the U.S. Treasury will sell $42 bln in 2-yr notes this afternoon. Crude oil is looking to recover some of last week’s loss while the U.S. Dollar Index is down 0.2% at 102.70.

2-yr: -3 bps to 4.72%
3-yr: -4 bps to 4.29%
5-yr: -6 bps to 3.94%
10-yr: -5 bps to 3.69%
30-yr: -4 bps to 3.78%