Bond Market Update

Quiet Start Ahead

• U.S. Treasuries are on track for a slightly higher start after a sideways night in the futures market. Treasuries gave back some of their starting gains during yesterday's cash session, but futures began rising shortly after the close. They remained on a slight upward path through the night, reaching highs near the start of the European session. Yesterday's Iran-related optimism has faded a bit with markets speculating whether the U.S.-Iran ceasefire will hold amid Israeli attacks on Hezbollah targets in Lebanon. The overnight data flow was on the light side but the U.S. session will feature a sizable slate, including the Personal Income/Outlays report for February and the third estimate of Q4 GDP. The U.S. Treasury will cap this week's auction slate with a $22 bln 30-yr bond reopening at 13:00 ET. Crude oil is back near $100/bbl while the U.S. Dollar Index is down 0.2% at 98.90.
• Yield Check:
  • 2-yr: -2 bps to 3.77%
  • 3-yr: -1 bp to 3.80%
  • 5-yr: -1 bp to 3.91%
  • 10-yr: -1 bp to 4.28%
  • 30-yr: -1 bp to 4.88%

• News:
  • Reserve Bank of New Zealand Governor Breman continues expecting the Kiwi economy to grow in 2026.
  • G7 finance ministers will meet in Washington this weekend.
  • The Bank of England's Financial Stability Board noted that some stresses may be emerging in private credit.
  • The Bank of England's credit conditions survey showed that availability of credit to households increased in Q1 and is expected to increase again in Q2.
  • Japan's March Household Confidence fell to 33.3 from 39.7 (expected 38.3) and March Machine Tool Orders jumped 28.1% yr/yr (last 24.2%).
  • Hong Kong's March FX Reserves reached $430.80 bln (last $439.30 bln).
  • Germany's February trade surplus reached EUR19.8 bln (expected surplus of EUR18.1 bln; last surplus of EUR20.3 bln) as imports grew 4.7% m/m (expected 4.0%; last -5.1%) and exports rose 3.6% m/m (expected 1.0%; last -1.5%).
  • Spain's February Industrial Production fell 1.1% yr/yr (expected 1.5%; last -0.2%).
• Commodities:
  • WTI Crude: +5.1% to $99.20/bbl
  • Gold: UNCH at $4775.40/ozt
  • Copper: -1.3% to $5.703/lb
• Currencies:
  • EUR/USD: +0.2% to 1.1686
  • GBP/USD: +0.2% to 1.3424
  • USD/CNH: UNCH at 6.8344
  • USD/JPY: +0.2% to 158.88
• Data out Today:
  • 8:30 ET: Weekly Initial Claims (Briefing.com consensus 215,000; prior 202,000), Continuing Claims (prior 1.841 mln), February Personal Income (Briefing.com consensus 0.5%; prior 0.4%), Personal Spending (Briefing.com consensus 0.6%; prior 0.4%), PCE Prices (Briefing.com consensus 0.4%; prior 0.3%), Core PCE Prices (Briefing.com consensus 0.3%; prior 0.4%), Q4 GDP -- third estimate (Briefing.com consensus 0.7%; prior 0.7%), and Q4 GDP Deflator -- third estimate (Briefing.com consensus 3.8%; prior 3.8%)
  • 10:00 ET: February Wholesale Inventories (Briefing.com consensus -0.2%; prior NA)
  • 10:30 ET: Weekly natural gas inventories (prior +36 bcf)
• Treasury Auctions:
  • 13:00 ET: $22 bln 30-yr Treasury bond reopening results