Analyst Michael MacKenzie said that the latest US CPI report means that the Fed's possibility of cutting interest rates in September is back, and swaps show an 18 basis point cut. The November rate cut is fully priced in at 29 basis points. The front-end Treasury yield fell by about 15 basis points. The yield curve steepening trade is most attractive between 5-year and 30-year bonds because the long-end bond rally lags behind.