Bond Market Update

Long End Turns Positive

• Longer-dated Treasuries hold modest gains after turning positive during the past two hours while 5s and shorter tenors remain in the red, but well above today's lows. Treasuries revisited their opening lows in mid-morning trade just as the market learned that the G7 is not ready for a coordinated oil reserve release, but that's where the market found support. Treasuries climbed off lows for the next couple hours, receiving some assistance from the New York Fed's Survey of Consumer Expectations for February, which showed a ten-basis point decrease in year-ahead inflation expectations to 3.0% while three- and five-year expectations remained at 3.0%. Elsewhere, equities have recovered from their sharply lower start with the S&P 500 narrowing its loss to 0.2%, encouraged by crude oil's return below $100/bbl after soaring to $120/bbl overnight.
• Yield Check:
  • 2-yr: +2 bps to 3.58%
  • 3-yr: +2 bps to 3.60%
  • 5-yr: +1 bp to 3.73%
  • 10-yr: UNCH at 4.13%
  • 30-yr: -2 bps to 4.74%