Bond Market Update

Eye on the Yen

• It has been a roller-coaster trade for the Treasury market today. The futures trade overnight saw a steady stream of buying interest that coincided with a steady increase in the yen versus the dollar. The yen is still stronger against the dollar (USD/JPY -0.8% at 148.08), but not as strong as before. With some of the steam coming out of that trade, there has been a pullback in Treasuries.
• Yields are now little changed relative to where they closed yesterday's session.
• Stocks aren't doing much at the index level. The major indices are up fractionally in what has been a consolidation trade so far following a big run off the August 5 lows.
• Yield check:
  • 2-yr: -2 bps to 4.08%
  • 3-yr: -2 bps to 3.89%
  • 5-yr: -2 bps to 3.78%
  • 10-yr: -3 bps to 3.90%
  • 30-yr: -2 bps to 4.16%