US Treasuries weakened Tuesday on a steepening move and giving up some of the gains of the

Market Roundup

• US Treasuries weakened Tuesday on a steepening move and giving up some of the gains of the past week, ahead of FOMC minutes and NFP, as well as the Trump administration again talking up its infrastructure spending plan. Transportation secretary Elaine Chao said details of the plan could be unveiled by next month.
• Richmond Fed president Jeffrey Lacker has resigned due to improper communication between himself and a Medley Global Advisors analyst in 2012. The leak was surrounding the Fed’s announcement of $40 billion in additional MBS purchases which was subsequently mentioned in a publication. He was already slated to resign in Oct and is currently a non-voting member of the FOMC. He will be replaced by Mark Mullinix. Also Fed Governor Tarullo who is a FOMC voter will be stepping down tomorrow.
• Fx were supported by talk the white house will seek to hold a vote on the Obamacare repeal. There was very little cheer surrounding that news due to little expectation that they would be able to garner the votes needed. Also transportation secretary Elaine Chao said that an infrastructure plan would be out probably in May. Again, little cheer there as markets prefer to wait to see the goods before assigning odds of success.
• Ringgit govvies closer slightly firmer, guided by overnight gains in UST. However, gains were mild amid a lack of fresh catalysts. Elsewhere, the new 20-year MGS auction was announced with a size of RM2 billion, along with additional RM1 billion for private placement. WI was last heard at 4.75%.
• Investors led by asset managers and commercial banks took profit in Thai bonds ahead of the FOMC minutes on Thursday and US NFP report on Friday. After the MPC meeting on Mar 29, Thai bonds rallied especially at the back of the curve as yields plunged more than 15bps. The market might not find additional evidence to increase positions or they began to have concerns on overpriced risk, so they booked profits in long- and mid-term bonds causing 1-3bps higher shift on the curve. Despite halted bonds rally, overseas investor continued to buy both of short- and long-term Thai bonds at Bt6.30billion.
• IndoGBs were traded in tight range on Tuesday, while the market was generally a bit quiet with IDR Syariah auction underway. MoF targeted to issue IDR6 trillion in auction day, and incoming bids seemed moderate at IDR11.5 trillion. Hence, government downsized the issuance to IDR4.46 trillion and not issuing 08/23 PBS11 at all. Market didn't move after auction result announcement and stayed at current levels until close. Market volume increased to IDR14.0 trillion and dominated by bonds maturing in over 10 years (37%).