Bond Market Update

Early Gains Reversed

• U.S. Treasuries have retreated from their morning highs, turning slightly negative. The Treasury complex reached highs just as equities rallied out of the gate, followed by a steady retreat. That said, the backtracking has taken place at a slow pace, which leaves the market within a striking distance of yesterday's closing levels. Longer tenors underperformed in early trade and they remain behind while the short end has put up a bit of a bigger fight. Barring a volatile finish, the 10-yr yield is on track to end the week with a 15-bps increase while the 2-yr yield is up 13 bps from last Friday's settlement.
• Yield Check:
  • 2-yr: +1 bp to 4.08%
  • 3-yr: +1 bp to 4.02%
  • 5-yr: +2 bps to 4.04%
  • 10-yr: +2 bps to 4.22%
  • 30-yr: +2 bps to 4.49%