Bond Market Update

Data Recon

• The trade deficit widened to $78.2 billion in November (Briefing.com consensus -$77.9 billion) from an upwardly revised $73.6 billion (from -$73.8 billion) in October. The widening was the result of exports being $7.1 billion more than October exports and imports being $11.6 billion more than October imports.
  • The key takeaway from the report is that the import surge likely reflects a bid to get ahead of President-elect Trump's tariff plans, meaning businesses might have more inventory than usual waiting to be utilized/sold that detracts from import demand in coming months (i.e., post-inauguration).
• Yield Check:
  • 2-yr: -1 bp to 4.26%
  • 3-yr: +1 bp to 4.32%
  • 5-yr: UNCH at 4.42%
  • 10-yr: +1 bp to 4.63%
  • 30-yr: +2 bps to 4.86%