Bond Market Update

Short End Maintains Lead

• U.S. Treasuries have dipped from their post-CPI highs, but the short end remains comfortably in the green with the 2-yr yield sitting just below its 50-day moving average (4.144%) after slipping below that mark during the earlier advance. Meanwhile, the 10-yr yield is back above the 50-day moving average of its own (4.222%) after briefly falling below that level during the post-CPI bounce. The in-line CPI report, which contained a mild increase in the shelter component, has invited a rally in equities with the Nasdaq (+1.3%) leading the S&P 500 (+0.7%) by a solid margin.
• Yield Check:
  • 2-yr: -2 bps to 4.13%
  • 3-yr: -2 bps to 4.09%
  • 5-yr: UNCH at 4.10%
  • 10-yr: +2 bps to 4.24%
  • 30-yr: +4 bps to 4.45%