Bond Market Update

Inching Lower

• U.S. Treasuries are on track for a slightly lower start to the week after a sleepy night in the futures market. Treasury futures inched higher at the start of the overnight session, adding to their gains once the focus shifted to action in Europe. However, the market has not been able to sustain its overnight advance, having slipped back to last night's lows in recent trade. Still, the losses have been kept in check. Overnight action saw a limited dose of noteworthy economic data while the U.S. session will not feature any releases today. Crude oil is looking to continue its rally from last week while the U.S. Dollar Index is down 0.2% at 105.54.
• Yield Check:
  • 2-yr: +2 bps to 4.75%
  • 3-yr: +2 bps to 4.48%
  • 5-yr: +2 bps to 4.29%
  • 10-yr: +1 bp to 4.27%
  • 30-yr: +1 bp to 4.41%

• News:
  • China's fiscal revenue for the first five months of the year was down 2.8% yr/yr while expenditures were up 3.4%.
  • The Bank of Japan will hold a meeting with bond market participants on July 9 and 10. 
  • Japan's Prime Minister Kishida said that gasoline subsidies will be maintained through the end of the year.
  • Germany's Economy Minister Habeck said that the European Union is willing to negotiate the specifics of electric vehicle tariffs with China.
  • European Central Bank policymaker Schnabel said that the central bank will not commit to a specific policy path since there is a potential for price shocks.
  • China's May FDI was down 28.2% YTD (last -27.9%).
  • Singapore's May CPI was up 0.7% m/m (last 0.1%), rising 3.1% yr/yr (expected 3.0%; last 2.7%). May Core CPI was up 3.1% yr/yr (expected 3.0%; last 3.1%).
  • New Zealand's May trade surplus reached NZD204 mln (expected surplus of NZD155 mln; last deficit of NZD3 mln). May Credit Card Spending was unchanged yr/yr (last -0.8%).
  • Germany's June ifo Business Climate hit 88.6 (expected 89.4; last 89.3). June Current Assessment hit 88.3 (expected 89.4; last 89.3) and Business Expectations hit 89.0 (expected 91.0; last 90.3).
  • U.K.'s June CBI Industrial Trends Orders improved to -18 from -33 (expected -26).
• Commodities:
  • WTI Crude: +0.5% to $81.10/bbl
  • Gold: +0.4% to $2340.10/ozt
  • Copper: -0.4% to 4.424/lb
• Currencies:
  • EUR/USD: +0.4% to 1.0732
  • GBP/USD: +0.1% to 1.2661
  • USD/CNH: -0.1% to 7.2831
  • USD/JPY: -0.2% to 159.50
• No Data on Today's Schedule