No auction concession, yet
March 11, 2024
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–Japan revised an initial negative print for GDP (last three months of the year), to positive 0.4%, providing cover to end negative rates and YCC. Ten year JGB prints a new high for this calendar year at 75.5 bps and $/yen is pressing lower, now at 146.60. The 200 dma is 146.22; we’ve been above that moving average since early Jan, but it now appears that 145 is a target. BOJ is March 18/19. Last year’s JGB high was nearly 1% in October.
–Three-yr treasury auction today, followed by 10s and 30s Tuesday and Wednesday. CPI is tomorrow. Headline yoy expected 3.1% from 3.1 last. Core expected 3.7% from 3.9. Friday’s employment report featured higher than expected NFP at 275k, but revisions and other aspects of the report were soft. Yields were mixed, with 2s down 2.8 bps to 4.484% but tens nearly unch’d at 4.087%. As mentioned in yesterday’s note, TY puts expiring this Wednesday, March 13, were heavily traded (bought). Open interest just on Wednesday puts rose 76k. TY wk2 Wed 110.75 puts settled 4 adding 21.4k in open interest. The 111p traded 62k in volume and settled 7, adding 6.6k in open interest. Futures settled 111-23+. Current print is 111-25+.
–Bitcoin has exploded to a new high of 71700. Can crypto strength spark renewed buying in Nasdaq after the huge reversal in NVDA on Friday?
