Bond Market Update

Dollar Respite

• Treasury yields have moved up from their lows of the session, but oil prices have remained subdued. The latter has been a key ingredient for today's upside bias, both in stocks and bonds.
• The dollar has taken a respite from recent gains, pushed by less risk aversion and an underlying hope that the war with Iran will end relatively soon without doing too much damage to the global economy.
• Market participants were largely non-responsive to today's economic data, cognizant that the main event (outside of the Iran war) will be the litany of central bank policy announcements heard this week (16 in all). The Reserve Bank of Australia starts things off tonight and will be followed later in the week by the Fed, the Bank of England, the Swiss National Bank, the ECB, and the Bank of Japan.
• Yield check:
  • 2-yr: -4 bps to 3.69%
  • 3-yr: -5 bps to 3.70%
  • 5-yr: -5 bps to 3.82%
  • 10-yr: -6 bps to 4.23%
  • 30-yr: -4 bps to 4.87%