Free Trial

Curve Lower, Flatter as Yields Reverse Off Cycle Highs

US TSYS SUMMARY

Treasuries were sold in response to the better-than-expected jobs report, with yields boosted smartly in the 10y sector of the curve. Benchmark 10y yields rose above the 1.6% mark to print 1.6238% - a new cycle high - before reversing on profit-taking flow as well as residual demand from foreign real money accounts and central banks across 5 - 10yr sector of the curve.

  • The curve itself traded lower and flatter into the close. A lot of focus was paid to the sharp rise in real yields post-payrolls, with inflation breakevens initially making up lost ground following Powell's comments Thursday.
  • Shortly after the data, real yields fully reversed the knee-jerk move (bringing nominal yields back below 1.60%) though breakevens are held gains.
  • The Fed blackout kicks off Saturday, leaving markets to parse data due in the coming week. US CPI/PPI crosses as well as prelim Uni. of Michigan confidence.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.