Bond Market Update

2024 Highs in Sight

• U.S. Treasuries trade firmly in the green after adding to their solid opening gains. Treasuries gapped higher at the open, seeing a continuation of their early strength after the release of the latest jobless claims report (249,000; Briefing.com consensus 233,000; prior 235,000), which showed an unexpected increase. The market also learned that preliminary Q2 productivity (2.3%; Briefing.com consensus 1.6%) increased more than expected while unit labor costs (0.9%; Briefing.com consensus 1.7%) grew less than expected, making for a welcome combination. Treasuries rallied to fresh highs during the past 15 minutes, responding to the ISM Manufacturing Index for July (46.8%; Briefing.com consensus 48.5%), which showed a deepening contraction in the manufacturing sector. The early advance has pressured the 2-yr yield to within eight basis points of this year's low from January while the 10-yr yield is 19 basis points above this year's low.
• Yield Check:
  • 2-yr: -14 bps to 4.20%
  • 3-yr: -15 bps to 3.99%
  • 5-yr: -15 bps to 3.85%
  • 10-yr: -13 bps to 3.98%
  • 30-yr: -11 bps to 4.26%