Bond Market Update

Short End Bounces

• U.S. Treasuries have climbed off their early lows with 3s and 2s turning positive while longer tenors remain in the red with the long bond continuing today's underperformance. Treasuries extended their starting losses during the first hour of action, lifting yields on 10s and 30s to levels last seen in mid-July while the 2-yr yield reached a level last seen in early June. However, the market found resistance, reaching highs in recent trade after the release of a disappointing Consumer Sentiment Index from the University of Michigan (53.3; Briefing.com consensus 55.5). Despite today's underperformance, longer tenors are on track to finish the week little changed with the 30-yr yield currently flat for the week while the 2-yr yield is up seven basis points from last week's settlement.
• Yield Check:
  • 2-yr: -2 bps to 3.96%
  • 3-yr: -2 bps to 3.97%
  • 5-yr: UNCH at 4.10%
  • 10-yr: +3 bps to 4.44%
  • 30-yr: +3 bps to 4.97%