Treasuries open NY higher after overnight gains. In TOKYO, Treasuries gained from the start after last Friday’s “risk-on” decline followed EU Summit plans, due to belated month-end buying by Japanese accounts as well on reaction to weaker than expected Chinese data, 48.2 June HSBC Mfrg PMI (weakest since Nov. 2011). Asian buy-and-hold accounts bought 7Y notes. Asian central bank interest arose in 5Y note, other Asian central bank selling arose in 10Ys. In LONDON, Treasuries narrowly mixed, longer end outperforming. Treasuries pressured too as German Bunds fell off highest level but gained on news Finland, Netherlands govts are to block plans for ESM secondary mkt bond buys. Fast money did 10/30Y flatteners, other mild 30Y bond buying. Many sidelined into Tues SIFMA US 2pm ET early bond mkt close, Wed US Independence Day, Fri US June jobs. 10-yr US/German spread trading at +6 bps. Real money bought Europe peripheral debt, while other buy-&-hold accts bought US 10Ys. MBS-tied buying arose in 5Y, 10Y Tsys.
EasyForexNews Research Team