Bond Traders Weekly Outlook: Yields Rise into Year End

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    U.S. Treasuries saw some imbalanced behavior between the front of the curve and the back of the curve. The former faced some modest selling pressure while the latter attracted buyers.

    The 2s10s spread, inverted by 46 bps coming into today, was wider by 54 bps at the close of the cash session.

    Today’s trade involved a $35 bln 7-yr note auction that met with average dollar demand, but nonetheless saw the high yield of 3.921% tail the when-issued yield of 3.913%. There wasn’t much reaction to the auction results.

    2-yr: +2 bps to 4.37%
    3-yr: +1 bp to 4.18%
    5-yr: -2 bps to 3.96%
    10-yr: -6 bps to 3.83%
    30-yr: -5 bps to 3.92%


    U.S. Treasuries traded in relatively tight ranges overnight amid a lack of conviction on this final trading day of the year.

    SIFMA recommends an early close today for the bond market at 2:00 p.m. ET. Not much in the way of news flow to drive any meaningful activity.

    The Bank of Japan conducted its third straight unscheduled bond buying operation, focusing a JPY300 bln effort on 10-25yr JGBs. The U.S. Dollar Index is down 0.2% to 103.68.

    2-yr: +1 bp to 4.38%
    3-yr: +1 bp to 4.19%
    5-yr: +1 bp to 3.97%
    10-yr: +1 bp to 3.84%
    30-yr: unch at 3.92%


    U.S. Treasuries closed out 2022 with higher yields across the curve. The 10-yr note yield held under 3.90%, and the 2s10s inversion remained at 54 bas
    [See the full post at: Bond Traders Weekly Outlook: Yields Rise into Year End]

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