The US will auction $109 bln in coupons next week right in the sweet spot of the central bank’s favorite part of the curve. They will auction 2-year, 5-year and 7-year notes.

Demand has been very solid at recent auctions with dollar stability and nascent signs of economic recovery (implying a future ability to repay) helping improve confidence.

Dollar stability is the story of the day as prices trade in narrow ranges. EUR/USD is at 1.4233; USD/JPY at 94.19.