Bond Market Update

Early Gains Padded

• U.S. Treasuries trade near their highs after adding to their opening gains. Treasuries followed their modestly higher open with a quick extension of their starting advance after the Personal Income/Outlays report for June showed below-consensus income growth (0.2%; Briefing.com consensus 0.4%) and no change in the yr/yr core PCE Price Index, which remained at 2.6% for the second month in a row. Overall, the report was seen as one that supports the case for a September rate cut, which the market sees as a certainty at this time. Equities are off to a higher start with the S&P 500 (+0.9%) narrowing this week's loss to 1.1% while the Russell 2000 (+1.9%) is now up 3.7% for the week.
• Yield Check:
  • 2-yr: -6 bps to 4.38%
  • 3-yr: -7 bps to 4.19%
  • 5-yr: -7 bps to 4.08%
  • 10-yr: -6 bps to 4.19%
  • 30-yr: -5 bps to 4.45%