10-Yr: -09+/32..3.718%.. USD/JPY: 95.7500.. EUR/USD: 1.3992Sold: Treasuries are offered heading into the housing data, with the 7-yr leading lower. The week’s auctions start going off today with the 2-yr, while the upcoming 5-and-7-yrs success is less certain. The market may fall into a coma as it awaits the FOMC and if the May housing number does not come in too high. Traders are looking for a better number, but not anything well beyond 5.00M as rates had been higher in the month. On the other side, a severely poor report will likely see little reaction, falling into the “not as bad as it could have been bin.” The “watch and wait” business may be shaken off if stocks make a large move, but trade will be wafer-thin. Treasury will sell $40B 2-yrs which are expected to go down fairly well, with the previous auction having been decent and the shorter maturities a bit easier for the market to swallow at rates at higher levels. The previous outing a 0.940% yield with an excellent 2.94 cover and 54.4% indirect bidder participation rate. Global bonds are also on offer with supply on the table. The curve is flatter, with the 2-10-yr yield spread running 254.3 from 256. The dollar has been sold with the euro running back to just shy of 1.4000. The yen has seen the best levels since the start of June, ticking to a month high against the euro. Gold has seen a push back to better levels as the buck backs off, with spot now 924.65 (+1.95). Crude has been regaining some ground as stocks come back, bubbling better now 68.10 (+0.60). Data offers existing home sales (10) along with the auction and the start of the FOMC (paralysis)
