US Treasuries moved a tad weaker by Thursday’s close, paring some earlier losses. Overall benchmark yields were about 1bp higher by end of day. Ahead of Friday’s May NFP release, the ADP jobs report showed growth of 253k in May - which swayed UST y

Market Roundup

• US Treasuries moved a tad weaker by Thursday’s close, paring some earlier losses. Overall benchmark yields were about 1bp higher by end of day. Ahead of Friday’s May NFP release, the ADP jobs report showed growth of 253k in May - which swayed UST yields higher earlier in the day – against consensus +180k and Apr’s +174k. The ISM manufacturing index showed reading of 54.9 in May which is a small rise from 54.8 in Apr. Elsewhere, Fed governor Powell said confidence in the economy will spur inflation towards the Fed’s 2.0% target. On the flipside, initial jobless claims rose to 248k in the week ended 27 May from 235k the week before.
• Malaysia: Government bonds remained in range on Thursday. Meantime, MYR steady just below 4.2900 late Thursday aided sentiment. There was hint of profit taking activity along select tenors including the 7-year MGS but overall yields rose just slightly.
• Thailand: Thai bonds rallied for all tenors with lower shift in curve by 2-3bps after inflation in May surprised at the downside. Thailand headline CPI was 0.04% yoy and core CPI grew tepidly at 0.49% yoy mainly with disinflation in fresh food and vegetable prices. As USD/THB downtrend was paused after failing to break through 34.00, we saw offshore sell-off flows (Bt3.41 billion along short-end bonds). However, foreign position in long-term bond stayed firm (they continued to purchase long dated maturity at Bt 1.61 billion). We expect bond rally will halt Friday ahead of NFP.