Bond Market Update

Pulling Back From Monday Rally

• U.S. Treasuries are on track for a modestly lower start after yesterday's intraday rally that was paced by the front end. Treasury futures spent the first half of the night in a sideways range, slipping to lows once the focus turned to action in Europe. Global equities have had a mostly positive, but a guarded, showing, while sovereign debt is mixed, but little changed overall. There was some ongoing focus on President Trump's indication that he is looking to ease the tariff burden on automakers and the market received some soft sentiment data from Europe. The U.S. session will feature the release of April Consumer Confidence (Briefing.com consensus 88.3; prior 92.9) and March Job Openings (prior 7.568 mln) at 10:00 ET. Crude oil is adding to yesterday's loss while the U.S. Dollar Index is up 0.3% at 99.32.
• Yield Check:
  • 2-yr: +3 bps to 3.71%
  • 3-yr: +2 bps to 3.70%
  • 5-yr: +2 bps to 3.84%
  • 10-yr: +2 bps to 4.24%
  • 30-yr: +2 bps to 4.71%

• News:
  • Vietnam's prime minister said that specific negotiating points will be ready imminently.
  • Japan's trade negotiator will be in Washington over the next three days.
  • New Zealand's Finance Minister Willis warned that the growth forecasts for 2025 and 2026 will be cut.
  • The Liberal Party won Canada's election, meaning Mark Carney will remain prime minister.
  • Singapore's Q1 Unemployment Rate rose to 2.1% from 1.9%.
  • Eurozone's April Business and Consumer Survey fell to 93.6 from 95.0 (expected 94.5). March M3 Money Supply was up 3.6% yr/yr (expected 4.0%; last 4.0%). March Private Sector Loans rose 1.7% yr/yr (expected 1.6%; last 1.5%). March Loans to Non-Financial Corporations grew 2.3% yr/yr (last 2.2%).
  • Germany's May GfK Consumer Climate rose to -20.6 from -24.3 (expected -25.6).
  • Spain's Q1 GDP expanded 0.6% qtr/qtr (expected 0.7%; last 0.7%), growing 2.8% yr/yr (last 3.3%). April CPI was up 0.6% m/m (last 0.1%), rising 2.2% yr/yr (expected 2.0%; last 2.3%). April Core CPI was up 2.4% yr/yr (last 2.0%).
  • Italy's April Business Confidence fell to 85.7 from 86.0. April Consumer Confidence fell to 92.7 from 95.0 (expected 94.0). February Industrial Sales were down -0.4% m/m (last 3.7%), falling 1.5% yr/yr (last 1.8%).
• Commodities:
  • WTI Crude: -1.6% to $61.05/bbl
  • Gold: -0.7% to $3324.20/ozt
  • Copper: +1.2% to $4.897/lb
• Currencies:
  • EUR/USD: -0.3% to 1.1380
  • GBP/USD: -0.4% to 1.3386
  • USD/CNH: -0.1% to 7.2787
  • USD/JPY: +0.4% to 142.63
• Data out Today:
  • 8:30 ET: Advance March International Trade in Goods (prior -$147.9 bln), advance March Retail Inventories (prior 0.1%), advance March Wholesale Inventories (prior 0.3%)
  • 9:00 ET: February FHFA Housing Price Index (prior 0.2%) and February S&P Case Shiller Home Price Index (Briefing.com consensus 4.7%; prior 4.7%)
  • 10:00 ET: April Consumer Confidence (Briefing.com consensus 88.3; prior 92.9) and March Job Openings (prior 7.568 mln)