Liquidity in Front-End U.S. Treasurys Weakens, Bid-Ask Spreads Widen -- Market Talk
Dow Jones03-25 18:33
1031 GMT - Liquidity at the front end of the U.S. Treasury yield curve has deteriorated amid elevated volatility since the onset of the Middle East conflict, Morgan Stanley strategists say in a note. This has led to wider bid-ask spreads and high volumes signaling forced flows, they say. "Elevated volumes alongside wider spreads suggest flows are driven by necessity rather than desire." Two-year bid-ask spreads have widened around 27% versus February, they say. "Large intraday yield swings are increasingly coinciding with thin liquidity conditions in the front end." (emese.bartha@wsj.com)
(END) Dow Jones Newswires
March 25, 2026 06:33 ET (10:33 GMT)
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