Bond Market Update

Calming Down

• The Treasury market has calmed down after some early volatility that was tied to an announcement by President Trump that he is recommending a straight 50% tariff on the EU because the trade talks are going nowhere.
• A White House official told CNBC, however, that his comment should be viewed as negotiating leverage and the stock market was overreacting to it. Stocks calmed down a bit as well after the clarification. The major indices have pared their opening losses but remain in negative territory. The S&P 500 is down 0.7% after being down as much as 1.3%.
• Yield check:
  • 2-yr: -2 bps to 3.98%
  • 3-yr: -3 bps to 3.95%
  • 5-yr: -4 bps to 4.07%
  • 10-yr: -5 bps to 4.50%
  • 30-yr: -3 bps to 5.03%