The holiday-shortened US week means a compacted US Treasury auction schedule today. Up first are $69 billion in US 2-year sale at the unusual time of 11:30 am ET. That's followed by $70 billion of 5s at the usual 1 pm ET time.
That's a monster amount of supply hitting the front end and belly of the curve in one day. With consumer confidence beating expectations and the supply, the early dip in yields has largely reversed. Currently 2s are down 2.4 bps to 4.93% and 5s are flat at 4.53%.
We might see a bit of a relief rally in the front end if we can get through these unscathed.
