Treasury Action: the selloff deepened as volume picked up
Treasury Action: the selloff deepened as volume picked up, with concession building next week's supply adding to the erosion. Treasury is selling $78 B in 3-, 10-, and 30-year paper, beginning Tuesday with $24 B in 3-year notes. The 2-year yield rose over 11 bps to peak at 1.879%. The when issued 3-year also is 10 bps cheaper at 1.82%. The wi 10-year is up 9 bps at 2.040%. And the bond has risen 7.5 bps to 2.545%. The 3-year auction will be difficult ahead of Fed Chair Powell's Monetary Policy Report to Congress on Wednesday at the Senate Banking Committee given uncertainties over what he'll suggest about the July 30, 31 policy stance. While he shouldn't pre-judge the FOMC's decision, it will be interesting to hear how he characterizes the economy and the various risks, as well as inflation dynamics versus the Fed's outlooks revealed in the June SEP. Remember the Fed's "dots" don't even include a rate cut this year.