The two-year is leading the move. That is the usual pattern when the market is rereading the next Fed steps and the long end only follows. The 10-year confirms the direction. It does not set it.
An overlay on the long end, only because the two-year moved, would be a second bet. The desk separates the front-end event from the duration already in the book.
Cash in bills stays the liquidity instrument. The two-year is the instrument for a view on the path. They do not belong on the same ticket.
What the desk is watching
- Two-year leads, the 10-year follows
- No automatic duration overlay
- Bills stay the cash instrument