Bond Market Update

Data Recon

• Initial jobless claims for the week ending February 22 increased by 22,000 to 242,000 (Briefing.com consensus 220,000). Continuing jobless claims for the week ending February 15 were 1867K (prior revised to 1867K from 1869K).
  • The key takeaway from the report is that initial jobless claims reached their highest level since early December, which will add to the market's festering concerns about a slowdown in growth.
• The second estimate for Q4 GDP was 2.3% (Briefing.com consensus 2.3%; prior 2.3%) while the second estimate for the Q4 GDP Deflator was 2.4% (Briefing.com consensus 2.2%; prior 2.2%).
  • The key takeaway from the report is that the growth was driven largely by consumer spending and government spending, but with targeted efforts by the Trump administration to cut government spending and to implement tariffs, there will be concerns about GDP growth decelerating in coming quarters due to less of a contribution from consumer spending and government spending.
• January Durable Goods Orders were up 3.1% (Briefing.com consensus 1.8%; prior revised to -1.8% from -2.2%). Excluding transportation, durable goods orders were flat (Briefing.com consensus 0.4%; prior revised to 0.1% from 0.3%).
  • The key takeaway from the report is that nondefense capital goods orders, excluding aircraft -- a proxy for business spending -- logged a healthy 0.8% increase in January, offsetting the headline disappointment of an unchanged reading for durable goods orders, excluding transportation.
• Yield Check:
  • 2-yr: +3 bps to 4.10%
  • 3-yr: +1 bp to 4.08%
  • 5-yr: +4 bps to 4.12%
  • 10-yr: +5 bps to 4.29%
  • 30-yr: +4 bps to 4.55%