Halister News

(Bloomberg) -- Following are forecasts for today’s economic releases as compiled by Bloomberg News.

• CPI 0.2% m/m; range 0.1% to 0.3% (77 estimates)
• Core CPI 0.2% m/m; range 0.1% to 0.3% (75 estimates)
• CPI 1.8% y/y; range 1.7% to 2% (45 estimates)
• CORE CPI 1.7% y/y; range 1.7% to 1.9% (46 estimates)
• Core CPI Index SA 251.995; range 251.946 to 252.045 (4 estimates)
• CPI Index NSA 244.925; range 244.784 to 245.07 (14 estimates)
• In June, the CPI was unchanged, the second consecutive month without an increase
• “Core goods prices remain in outright deflation, while core services prices have decelerated to the slowest growth rate in two years”: Bloomberg Intelligence

To contact the reporters on this story: Alex Tanzi in Washington at atanzi@bloomberg.net ; Vincent Del Giudice in Denver at vdelgiudice@bloomberg.net To contact the editors responsible for this story: Alex Tanzi at atanzi@bloomberg.net Kristy Scheuble

(Bloomberg) -- Treasury skews have flipped in favor of upside as North Korea risks rise again, while ATM vols still remain well contained near record lows.

• Treasury skews for this year have flipped in favor of calls for the first time since June (see chart here of 25-delta 3-month skew); richening of upside can be seen across the surface here, while 1-month 50-delta has only risen about 50bp to 4.06% since Trump’s “fire and fury” comment
• In the OTC space, while USD 3m10y has only risen about 0.20bp/day to 4bp/day, short-dated skews on 10-year tenor have turned lower, with receivers trading equal to payers
  • See chart here of spread between USD 3m10y 25bp OTM payer vol and 25bp OTM receiver vol 
• The Korean market response has been modest with USD/KRW rising about 1.7% and Korean CDS widening only about 10bps; implied vol in Korean markets remain below/near long-term averages, highlighting the pricing of an all-out conflict in the peninsula remains remote; see more here
• NOTE: From July 14, Zero-cost USD rates receiver spreads; see more here
• NOTE: Tanvir Sandhu is an interest-rate and derivatives strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice

To contact the reporter on this story: Tanvir Sandhu in London at tsandhu17@bloomberg.net To contact the editors responsible for this story: Ven Ram at vram1@bloomberg.net Anil Varma

(Bloomberg) -- UST 5s30s steepener recommended on July 27 at ~108bp anticipated it would be profitable into Thursday’s $15b 30Y auction, as “curve has tended to steepen by an average of 4.4bp prior to 30-year bond auctions,” JPMorgan strategists led by Jay Barry say in Aug. 10 note; 5s30s curve closed Thursday at a 100bp, lowest since July 10, flattening driven in part by commodity price weakness.

• JPM also exited its July 20 recommendation to fade flattening of 3m6m bill curve driven by speculation that mid-October maturing bills faced delayed payment risk from federal debt ceiling; “these bills have fully reversed their cheapening relative to surrounding issues since then”

To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net To contact the editors responsible for this story: Boris Korby at bkorby1@bloomberg.net Joanna Ossinger

--ADELA LIN

Economic Release Details: {HKGDQOQ Index ECOD} --KYUNG BOK CHO

--ALARIC NIGHTINGALE

(Bloomberg) -- Treasury futures (TY1) technical levels in focus for Friday.

• Daily Trend Bias: Bullish
• Comment: Strong Thursday close (closed at day’s high) keeps immediate risks tilted higher for 126-29 test, at minimum; setbacks seen short-lived with rising 21-DMA (126-02) guiding the broader uptrend
  • Resistance: 126-26+; 126-29; 127-02; 127-08
  • Support: 126-18+; 126-16+ (pivot); 126-15; 126-11; 126-06
• NOTE: Roll-adjusted by difference in GFUT
• NOTE: Sejul Gokal is a FICC technical strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice

To contact the reporter on this story: Sejul Gokal in London at sgokal1@bloomberg.net To contact the editors responsible for this story: Ven Ram at vram1@bloomberg.net Anil Varma