Bond Market Update

Data Recon

• Initial jobless claims for the week ending September 7 increased by 2,000 to 230,000 (Briefing.com consensus 229,000). Continuing jobless claims for the week ending August 31 increased by 5,000 to 1.850 million.
  • The key takeaway from the report is that initial jobless claims remained fairly steady, underscoring the point that the labor market isn't suffering a material and rapid erosion that would challenge the soft landing view. The Producer Price Index for August was up 0.2% month-over-month (Briefing.com consensus 0.2%) following a downwardly revised 0.0% (from 0.1%) in July.
• The Producer Price Index, excluding food and energy, was up 0.3% month-over-month (Briefing.com consensus 0.2%) following a downwardly revised 0.2% decline (from 0.0%) in July. On a year-over-year basis, the Producer Price Index was up 1.7%, versus 2.1% in July, and the Producer Price Index, excluding food and energy, was up 2.4%, versus 2.3% in July.
  • The key takeaway from the report is the recognition that inflation at the wholesale level is moderating, which lessens concerns about heightened pass-through pressures to the consumer.
• Yield Check:
  • 2-yr: -1 bp to 3.64%
  • 3-yr: UNCH at 3.47%
  • 5-yr: UNCH at 3.45%
  • 10-yr: +1 bp to 3.66%
  • 30-yr: +2 bps to 3.98%