Bond Market Update

Data Recon

• November nonfarm payrolls increased by 227,000 (Briefing.com consensus 200,000). November private sector payrolls increased by 194,000 (Briefing.com consensus 200,000). November unemployment rate was 4.2% (Briefing.com consensus 4.2%), versus 4.1% in October. November average hourly earnings were up 0.4% (Briefing.com consensus 0.3%) versus 0.4% in October.
  • The key takeaway from the report is that it has satisfied the market's December rate cut curiosity in the sense that it gives the Fed cover, absent what we may see in next week's CPI and PPI reports, to cut the target range for the fed funds rate by another 25 basis points at the December FOMC meeting.
• Yield Check:
  • 2-yr: -7 bps to 4.08%
  • 3-yr: -6 bps to 4.04%
  • 5-yr: -6 bps to 4.02%
  • 10-yr: -4 bps to 4.14%
  • 30-yr: -1 bp to 4.32%