Bond Market Update

Data Recon

• Initial jobless claims for the week ending April 4 increased by 16,000 to 219,000 (Briefing.com consensus: 215,000). Continuing jobless claims for the week ending March 28 decreased by 38,000 to 1.794 million.
  • The key takeaway from the report is that continuing claims hit their lowest level since May 11, 2024.
• The third estimate for Q4 GDP checked in at 0.5% (Briefing.com consensus: 0.7%) versus the second estimate of 0.7%. The revision primarily reflected a downward revision to investment. The GDP Deflator was 3.7% (Briefing.com consensus: 3.8%) versus the second estimate of 3.8%.
  • The key takeaway from the report is that it suggests the economy closed last year on a sluggish note; however, it wasn't quite as soft as it appears when taking into account that real final sales to private domestic purchasers were up 1.8%.
• Personal income decreased 0.1% month-over-month in February (Briefing.com consensus: 0.5%) following a 0.4% increase in January. Personal spending rose 0.5% (Briefing.com consensus: 0.6%) following a downwardly revised 0.3% (from 0.4%) in January. The PCE Price Index jumped 0.4% (Briefing.com consensus: 0.4%) after rising 0.3% in January and was up 2.8% year-over-year, unchanged from January. The core PCE Price Index also rose 0.4% (Briefing.com consensus: 0.3%) on the heels of a 0.4% increase in January and was up 3.0% year-over-year versus 3.1% in January.
  • The key takeaway from the report is that it reflects sticky inflation pressure before the Iran war started, so it won't sway the Fed from sticking with a wait-and-see policy stance.
• Yield Check:
  • 2-yr: -1 bp to 3.78%
  • 3-yr: -1 bp to 3.80%
  • 5-yr: UNCH at 3.92%
  • 10-yr: +1 bp to 4.30%
  • 30-yr: UNCH at 4.89%