On 9th Nov, we had given a sell Reco on 10yr UST when yields were at 4.08. Our target was 4.30. Yest high was 4.297 so we close this reco for now.

Today’s sale of traditionally unloved 20-year JGBs in many ways couldn’t come at a tougher time. Long end JGB yields are at multi year highs. Amid the impending elections, today's auction might find it difficult to lure buyers even at such elevated yields.

Corporate bond supply in this holiday shortened week is likely to be almost half of last week's volume of $60 BN. Spreads are attractive for potential borrowers having tightened across the spectrum last week.

The Fed’s willingness to hit pause on the easing cycle got fresh support Thursday with jobless claims coming in better than expected yesterday. That pushed yields higher and signals bear flattening is likely to extend at least through to the next FOMC decision is announced Jan. 28.

Bond market volatility has fallen to levels that are approaching quarter-century lows associated with either zero-rate lethargy or sudden spikes. That’s likely to last until dual-sided risks for the Federal Reserve’s mandate become one-sided.

The big yield dispersion at the long end of the Japanese bond curve shows no sign of reversing, which suggests BOJ intervention may be the only way to shore up the market.