Bond Market Update

Inching Higher

• U.S. Treasuries are on track for a modestly higher start to the week after starting 2026 with a Friday dip. Treasury futures spent the overnight session in a steady advance while most other sovereign debt also climbed. JGBs bucked the trend, sending yields on all tenors up to the 30-yr to fresh highs for the year. Japan's Nikkei (+3.0%), meanwhile, jumped toward its record from October. The overnight data flow was on the lighter side with Japan's Manufacturing PMI (50.0) emerging from contraction in the final reading for December. The news flow has largely focused on the weekend U.S. operation to capture Venezuela's leader Maduro, who is scheduled to appear before a judge in New York this afternoon. Crude oil holds a modest gain while the U.S. Dollar Index is up 0.2% at 98.66.
• Yield Check:
  • 2-yr: -2 bps to 3.46%
  • 3-yr: -2 bps to 3.53%
  • 5-yr: -2 bps to 3.72%
  • 10-yr: -2 bps to 4.17%
  • 30-yr: UNCH at 4.86%

• News:
  • OPEC+ made no changes to its production plans at this Sunday's meeting, which had been expected.
  • President Trump repeated that he plans to travel to China in April.
  • Goldman Sachs expects China's GDP to grow about 4.8% in 2026.
  • China's December RatingDog Services PMI hit 52.0, as expected (last 52.1).
  • Japan's December Manufacturing PMI hit 50.0 (expected 49.7; last 48.7).
  • Singapore's November Retail Sales were unchanged m/m (last 2.3%), rising 6.3% yr/yr (last 4.4%).
  • U.K.'s November BoE Consumer Credit reached GBP2.077 bln (last GBP1.713 bln). November Mortgage Lending reached GBP4.49 bln (expected GBP4.80 bln; last GBP4.16 bln) and November Net Lending to Individuals reached GBP6.60 bln (expected GBP5.20 bln; last GBP5.40 bln).
  • Spain's December Unemployment decreased by 16,300 (expected 5,700; last -18,800).
  • Swiss November Retail Sales rose 2.3% yr/yr (expected 2.5%; last 2.2%). December Manufacturing PMI hit 45.8 (expected 49.9; last 49.7).
• Commodities:
  • WTI Crude: +0.6% to $57.68/bbl
  • Gold: +2.2% to $4425.20/ozt
  • Copper: +3.1% to $5.869/lb
• Currencies:
  • EUR/USD: -0.3% to 1.1679
  • GBP/USD: +0.1% to 1.3466
  • USD/CNH: +0.2% to 6.9798
  • USD/JPY: -0.2% to 156.60
• Data out Today:
  • 10:00 ET: December ISM Manufacturing Index (Briefing.com consensus 48.4%; prior 48.2%)