Bond Market Update

Data Recon

• The ISM Services PMI increased to 56.0% in October (Briefing.com consensus 53.5%) from 54.9% in September. That is the highest reading since July 2022. The dividing line between expansion and contraction is 50.0%, so the October reading reflects services sector activity accelerating from September.
  • The key takeaway from the report is that the pace of expansion in the largest sector of the U.S. economy accelerated to a two-year high with employment activity returning to expansion after a brief contraction in September. The Backlog Index showed a deepening contraction, which could slow the pace of expansion in the coming months.
• Yield Check:
  • 2-yr: +5 bps to 4.23%
  • 3-yr: +5 bps to 4.20%
  • 5-yr: +6 bps to 4.23%
  • 10-yr: +4 bps to 4.35%
  • 30-yr: +1 bp to 4.51%