Treasury Futures Push Higher After GDP Data & Fed Speakers

Treasury futures were range bound ahead of GDP, before a brief sell off was met with buyers while a raft of Fed speakers helped push futures to daily highs post the US close.

• Jun'24 futures have opened at 110-14, just above NY closing levels and highs from Wednesday. Looking at technical levels initial resistance at 110-28+ (20-day EMA) vs. support at 109-25+ (Low Feb 23).
• On the data front Wednesday saw GDP at 3.2% vs 3.3%, Personal Consumption at 3.0% vs 2.7%, while Core PCE Price Index was 2.1% vs 2.0%
• There were a flurry of Fed Speaks on Wednesday with Atlanta Fed President Bostic remaining "comfortable" with a patient Fed strategy to address inflation, he still expects the first rate cut this summer. NY Fed President Williams reiterated the Fed has a "ways to go to sustained 2% inflation", while Boston Fed President Collins wants greater confidence in disinflation before soften policy.
• Nevertheless, projected rate cut pricing looking steady to mildly higher at midyear vs. this morning's read: March 2024 chance of 25bp rate cut currently -2.7% w/ cumulative of -0.07bp at 5.322%; May 2024 steady at -18.4% w/ cumulative -5.3bp at 5.276%; June 2024 -55.5% from -54.5% earlier w/ cumulative cut -19.2bp at 5.137%. First full cut priced in at July w/cumulative -33.4bp at 4.995%. Fed terminal at 5.327% in Mar'24.
• Looking ahead: Personal Income/Spending, PCE, Jobless Claims & MNI Chicago PMI