Bond Market Update

Data Recon

• New orders for durable goods declined 2.2% month-over-month in December (Briefing.com consensus 0.4%) following a downwardly revised 2.0% month-over-month decline (from -1.1%) in November. Excluding transportation, durable goods orders increased 0.3% (Briefing.com consensus 0.5%) following a downwardly revised 0.2% decline (from -0.1%) in November.
  • The key takeaway from the report, though, is the understanding that new orders for nondefense capital goods excluding aircraft -- a proxy for business spending -- were up 0.5% on the heels of a 0.9% increase in November, thereby softening the disappointment of the headline number.
• Yield Check:
  • 2-yr: +2 bps to 4.21%
  • 3-yr: +2 bps to 4.26%
  • 5-yr: +3 bps to 4.36%
  • 10-yr: +3 bps to 4.56%
  • 30-yr: +3 bps to 4.80%