Bond Market Update

Data Recon

• Housing starts increased 5.2% month-over-month in July to a seasonally adjusted annual rate of 1.428 million units (Briefing.com consensus: 1.311 million), with single-unit starts up 2.8% and multi-unit starts up 9.9%. Building permits decreased 2.8% month-over-month to a seasonally adjusted annual rate of 1.354 million units (Briefing.com consensus: 1.390 million), with single-unit permits up 0.5% and multi-unit permits down 8.2%.
  • The key takeaway from the report is that there wasn't much strength in single-unit starts or permits, which is relatively disappointing in the context of a housing market that needs more affordable, single-family homes for sale. In fact, single-unit starts were down in all regions except the South (+13.2%).
• Yield Check:
  • 2-yr: -2 bps to 3.75%
  • 3-yr: -3 bps to 3.71%
  • 5-yr: -3 bps to 3.83%
  • 10-yr: -2 bps to 4.32%
  • 30-yr: -2 bps to 4.92%