Treasury Action: yields steadied below highs
Treasury Action: yields steadied below highs in the wake of the FOMC minutes, which raised the bar in favor of a December rate hike, but that did little to alter the near-100% balance of risks of following through on that threat. The 2-year yield consolidated near 1.13%, having shot up to test 1.15% vs 1.088% lows; the 5-year yield steadied near 1.84% having jumped from 1.75% lows to clear 1.88%; the 10-year yield retreated to 2.36% after the swing from 2.29% lows to test 2.42%; and the cash bond yield pulled back to 3.02% after the leapt from 2.985% to clear 3.09%. The belly continued underperforming the wings with yields now 2.0-5.0 bps higher along the curve, below earlier highs. The 2s-10s spread reversed earlier steepening to steady near +123 bp, but the 5s-30s spread traded 3-4 bp tighter near +120 bp.