Bond Market Update

CPI Provides Boost

• U.S. Treasuries have been boosted by the release of the October CPI report, which matched expectations at the headline (0.2%; Briefing.com consensus 0.2%) and core levels (0.3%; Briefing.com consensus 0.3%). The in-line increases pushed the yr/yr CPI rate to 2.6% from 2.4% in September while core CPI remained at 3.3% yr/yr for the second consecutive month. The post-data advance has been paced by the belly, allowing it to bounce after yesterday's underperformance. The early gains have returned the 10-yr yield to yesterday's opening level while the 5-yr yield is now below its opening mark from Tuesday.
• Yield Check:
  • 2-yr: -8 bps to 4.26%
  • 3-yr: -9 bps to 4.22%
  • 5-yr: -7 bps to 4.24%
  • 10-yr: -5 bps to 4.38%
  • 30-yr: -4 bps to 4.54%