The market absorbed a record $40 bln in 2-year notes with ease and yields are now falling as supply jitters wane. Fears of a buyers strike have proven unfounded thus far, though demand for longer-dated paper like tomorrow’s five year auction could be less robust. 10-year note yields have fallen about 10 bp today, to 2.55%, a sign that the concerns about China avoiding US assets may be receding after the White House downplayed any policy shift toward China yesterday.
EUR/JPY is seeing continued sales this afternoon, as is cruse oil and to a lesser extent gold. The rush to hard assets seen late last week appears to be running its course, a plus for the dollar.
Sorry for the lack of posts. We switched servers and it looks like a few of them have gone to the same place as half my 401K.
