U.S. Treasuries are on track for a modestly higher start in most tenors. Treasury futures climbed last evening, emboldened by weakening sentiment in Asia stemming from the reimposition of lockdown measures in China. The tightening of coronavirus restrictions invited protests in several cities, including Beijing. In Europe, there has been continued speculation that the Bank of England and the European Central Bank will shift down to 50-bp rate hikes going forward. Treasury futures reached overnight highs shortly after 3:00 ET, followed by a pullback that erased the bulk of last night's gains. Crude oil is on the defensive, falling to its lowest level in eleven months. The U.S. Dollar Index is down 0.3% at 105.61, returning to its 200-day moving average (105.37).
Yield Check:
2-yr: -2 bps to 4.46%
3-yr: UNCH at 4.23%
5-yr: UNCH at 3.87%
10-yr: -1 bp to 3.68%
30-yr: -2 bps to 3.72%
News:
Japan is expected to fine three power companies on antitrust grounds.
EU officials will reportedly continue discussing a potential price cap for Russian oil.
China's October Industrial Profit was down 3.0% YTD (last -2.3%).
Hong Kong's October trade deficit reached HKD20.90 bln (last deficit of HKD44.90 bln) as imports fell 11.9% m/m (last -7.8%) and exports were down 10.4% m/m (last -9.1%).
Australia's October Retail Sales were down 0.2% m/m (expected 0.5%; last 0.6%).
Eurozone's October Private Sector Loans were up 4.2% yr/yr (expected 4.5%; last 4.4%) and loans to nonfinancials were up 8.9% yr/yr (last 8.9%).
U.K.'s November CBI Distributive Trades Survey fell to -19 from 18 (expected 2).
Commodities:
WTI Crude: -3.0% to $74.00/bbl
Gold: +0.2% to $1756.80/ozt
Copper: -0.5% to $3.609/lb
Currencies:
EUR/USD: +0.7% to 1.0472
GBP/USD: UNCH at 1.2097
USD/CNH: +0.4% to 7.2191
USD/JPY: -0.6% to 138.30
