|10-Year: +3/32....%.... GNMAs: .... USD/JPY: 110.12.... EUR/USD: 1.1796|
-- Growing concern about Italy's request for debt forgiveness raises likelihood of a flight to safety: Lega deputy Claudio Borghi says debt forgiveness not part of the government's platform
-- April Housing Starts (actual 1287K; Briefing.com consensus 1325K; prior 1336K) and April Building Permits (actual 1352K; Briefing.com consensus 1350K; prior 1377K)
-- April Capacity Utilization (actual 78.0%; Briefing.com consensus 78.4%; prior 77.6%) and April Industrial Production (actual 0.7%; Briefing.com consensus 0.6%; prior 0.7%)
-- Weekly MBA Mortgage Index (actual -2.7%; prior -0.4%)
- Industrial production increased 0.7% in April (Briefing.com consensus +0.6%) on the heels of an upwardly revised 0.7% increase (from 0.5%) in March, marking its third straight monthly increase. The capacity utilization rate increased to 78.0% (Briefing.com consensus 78.4%) from a downwardly revised 77.6% (from 78.0%) in March.
- The key takeaway from the report is that the April increase was fueled by increased output across all three major industry groups.
- Manufacturing output, driven by gains for durables and nondurables, rose 0.5% after being unchanged in March
- Mining output, bolstered by further gains in the oil and gas sector, jumped 1.1% following a 0.8% increase in March
- Utilities output, supported by strong heating demand, increased 1.9% on the heels of a 6.1% increase in March
- On a year-over-year basis, industrial production increased 3.5%. The capacity utilization rate in April was 1.8 percentage points below its long-run average.
- Industrial production was revised down for December, January, and February
- Yield check:
- 2-yr: UNCH at 2.58%
- 5-yr: -2 bps to 2.91%
- 10-yr: -2 bps to 3.06%
- 30-yr: -2 bps to 3.19%