Weekly Market Update

Fed Day Arrives Treasuries are trading mostly unchanged this morning with the FOMC rate decision looming this afternoon. We expect that will be the case until the 2pm ET announcement and press conference fill-in some information gaps related to Fed policy (more on that below). Presently, the 10yr Treasury is yielding 4.29%, while the 2yr…

Risk-On Tone Opens Fed Week After a short period of consolidation, tech stocks are getting a second wind this morning and that risk-on tone has Treasuries on the defensive as Fed Week begins. So far, yields remain below year-to-date highs, but they are within shooting distance (see graph below). The FOMC meeting will go a…

Inflation Data Keeps Treasuries Under Pressure Treasury yields are moving higher as investors absorb all the inflation data this week that has tended to be on the hot side. That has investors revisiting odds of a June rate cut which a week ago were more than 60%, but now it’s closer to a coin-toss. Other…

Treasuries Trade Weaker as Supply and More Inflation News Awaits Treasuries are trading weaker today as $22 billion waits to be auctioned this afternoon. After yesterday’s so-so 10yr auction discretion appears to be the better part of valor today. Also, tomorrow and Friday offer more inflation news with PPI tomorrow and Import/Export prices on Friday….

Inflation Week Arrives It’s a tentative start as Inflation Week arrives. Treasuries are trading slightly lower, and equities are continuing the selling from last Friday. With CPI, PPI, and Import/Export prices, investors will have plenty of inflation news to chew on before the FOMC meeting next week (more on that below). Presently, the 10yr Treasury…

February Jobs Report – Something for Everyone  Nonfarm payroll gains for February were 275 thousand vs. 200 thousand expected and  229 thousand in January (revised down from an initial 353 thousand). In fact, the prior two-months were revised lower by 167 thousand jobs which continues a year-long trend of downward revisions.  Private sector jobs increased…

Treasuries Rally Ahead of Powell’s Congressional Testimony With Fed Chair Powell set to testify on Capitol Hill over the next two days, investors are hoping to gain additional color around the Fed’s reaction function towards rate cuts. Alas, Powell’s opening remarks offered little change from the patient pause approach, but his comment that rate cuts…

Whether January Strength Was A Fluke Will Start To Be Answered This Week With some pivotal economic releases pending this week Treasury yields are drifting higher this morning. The February jobs report looms on Friday while the ISM Services Index is due tomorrow (more on those below). Whether January strength was due to tricky seasonal…

More Fed Speak and an Early February Inflation Number Treasuries are hovering around unchanged levels this morning as a final slate of five Fed speakers go at it today, and we get our first look at February inflation pressure, or lack thereof, in the ISM Manufacturing Survey later this morning, (more on that below).  Presently,…

Market Awaits PCE Inflation Numbers Tomorrow Treasury yields are mostly unchanged as investors await the latest inflation readings tomorrow and a trio of Fed speakers this afternoon, (more on that below).  Presently, the 10yr Treasury is yielding 4.30%, unchanged on the day, while the 2yr Treasury is yielding 4.68%, up 1/32nd in price.   In…

More Inflation Data Due This Week Treasury yields are drifting a bit higher this morning as investors await Treasury supply today and tomorrow (more on that below).  The data calendar also picks up this week, and Fed speak will be plentiful, although comments are likely to sound familiar to last week’s patient pause messaging.    Presently,…

The Fed Affirms Their Patient Pause Approach Treasuries are marking time today with little data on offer and a pair of Treasury auctions awaiting on Monday. Those auctions, 2yr and 5yr, should keep any rally attempts in check, especially as this week’s Fed speak offered little hope of rate cuts anytime soon (more on that…