Bond Market Update

Reversing Last Week's Losses

• U.S. Treasuries are on track for a firmly higher start with longer tenors expected to show early relative strength after underperforming on Friday. Treasury futures began inching higher in early evening trade, continuing their advance into the night. The market reached highs around the start of the European session, followed by some slight backtracking. Other sovereign debt has also advanced even though energy prices continued climbing with WTI crude rising past $100/bbl. The Japanese yen briefly fell to 160/dollar, its lowest level since mid-2024, but a rebound developed after Bank of Japan's latest Summary of Opinions did not show opposition to additional rate hikes. As for the Iran conflict, President Trump said that Iran has agreed to most demands that were presented in a 15-point plan last week, but Iranian officials have not confirmed that publicly. The U.S. Dollar Index is up 0.1% at 100.28.
• Yield Check:
  • 2-yr: -5 bps to 3.87%
  • 3-yr: -5 bps to 3.89%
  • 5-yr: -6 bps to 4.01%
  • 10-yr: -6 bps to 4.38%
  • 30-yr: -5 bps to 4.93%

• News:
  • Standard & Poor's affirmed Japan's A+ rating with a Stable outlook.
  • U.S. Treasury officials will reach out to domestic and international insurance regulators to discuss systemic risk within the private credit sector.
  • Senate Banking Committee plans to complete nomination proceedings for the new Fed Chairman by April 13.
  • Companies listed in China and Hong Kong reported a 3.55% yr/yr increase in profits for fiscal 2025.
  • There was an increase in expectations for a rate hike from the Reserve Bank of Australia.
  • European Central Bank policymaker Lane said that the ECB will not hesitate to act.
  • The European Central Bank plans to simplify the approval process for changes to internal risk models of banks in the fall.
  • India's February Industrial Production was up 5.2% yr/yr (expected 4.7%; last 4.8%) and February Manufacturing Output rose 6.0% m/m (last 4.8%).
  • Eurozone's March Business and Consumer Survey fell to 96.6 from 98.2 (expected 96.5).
  • U.K.'s February Mortgage Lending reached GBP4.84 bln (expected GBP4.10 bln; last GBP4.21 bln), February Net Lending to Individuals reached GBP6.80 bln (expected GBP5.60 bln; last GBP5.90 bln), and February Mortgage Approvals hit 62,580 (expected 61,000; last 60,250).
  • Italy's February PPI was down 0.4% m/m (last 1.5%), falling 2.7% yr/yr (last -1.6%).
  • Spain's February Retail Sales rose 2.2% yr/yr (expected 3.8%; last 3.8%). 
  • Swiss March KOF Leading Indicators fell to 96.1 from 103.8 (expected 101.1).
• Commodities:
  • WTI Crude: +1.8% to $101.39/bbl
  • Gold: +1.7% to $4567.50/ozt
  • Copper: +0.4% to $5.516/lb
• Currencies:
  • EUR/USD: -0.2% to 1.1488
  • GBP/USD: -0.2% to 1.3233
  • USD/CNH: +0.1% to 6.9178
  • USD/JPY: -0.4% to 159.53
• No Data on Today's Schedule