Bond Market Update

Early Gains Padded

• U.S. Treasuries trade just below their best levels of the morning with shorter tenors leading. Treasuries inched above their opening levels after this morning's batch of data included a cooler-than-expected CPI report for March (-0.1%; Briefing.com consensus 0.1%), which showed a deceleration in the yr/yr CPI rate to 2.4% from 2.8% in February. In addition, the market received the latest jobless claims report, which featured an increase in initial claims (to 223,000 from 219,000) while continuing claims fell from their highest levels of the year (1.850 mln from 1.893 mln). Treasuries briefly reversed their post-data advance but recent trade has seen a return to session highs. Equities are off to a weak start, giving back some of yesterday's huge gains with the S&P 500 down 3.0%.
• Yield Check:
  • 2-yr: -15 bps to 3.80%
  • 3-yr: -15 bps to 3.82%
  • 5-yr: -15 bps to 3.95%
  • 10-yr: -10 bps to 4.30%
  • 30-yr: -2 bps to 4.77%