Bond Market Update

Long Bond Reclaims Morning Loss

• U.S. Treasuries of most tenors remain in the red, though the past couple hours have seen a rise off morning lows with the long bond leading the way. The 30-yr bond has outperformed from the start, but it still gave in to selling pressure during the first couple hours of action. That pressure briefly tipped the 30-yr into the red for the week, but with the recent bounce, it is again tracking a modestly higher finish with its yield down two basis points from last Friday's settlement. Up front, the 2-yr note has been at the forefront of today's weakness, but even with that selling it is also on course for a higher finish for the week with its yield down two basis points since last Friday. All in all, this week has been pretty good for Treasuries even though there has been no meaningful relief in the price of oil. However, the market received some reassurance about demand for longer tenors from good 10- and 30-yr auctions.
• Yield Check:
  • 2-yr: +4 bps to 4.80%
  • 3-yr: +4 bps to 4.93%
  • 5-yr: +3 bps to 5.02%
  • 10-yr: +2 bps to 5.25%
  • 30-yr: UNCH at 5.61%