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US TSYS: Curves Twist Steeper Ahead September FOMC Minutes, Inflation Data

US TSYS
USGlobalBulletMarketsFixed Income BulletsRegionNorth America
  • Treasuries are trading mixed after the bell, curves steeper with short end rates outperforming after much better selling since Friday's larger than expected September jobs gain and dip in the unemployment rate. The 2s10s curve is currently +2.810 at 5.639 - compared to just above 20.0 last week after briefly inverting early Monday.
  • Post-jobs consolidation has stalled as markets await tomorrow's September FOMC minutes followed by CPI and PPI on Thursday and Friday respectively.
  • While the vast majority of participants have since commented that they supported the half-point cut, the meeting decision brought the first dissent from a Fed governor (Bowman) since 2005, and it will be interesting to get a gauge of how many non-voting members also opposed the outsized rate reduction.
  • Consensus sees core CPI at 0.2% M/M in September, although there is sizeable skew toward a higher outcome and our survey of unrounded estimates sees an average 0.26% M/M. That’s only slightly softer than the surprisingly solid 0.28% M/M in August, but the drivers should differ.
     
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  • Treasuries are trading mixed after the bell, curves steeper with short end rates outperforming after much better selling since Friday's larger than expected September jobs gain and dip in the unemployment rate. The 2s10s curve is currently +2.810 at 5.639 - compared to just above 20.0 last week after briefly inverting early Monday.
  • Post-jobs consolidation has stalled as markets await tomorrow's September FOMC minutes followed by CPI and PPI on Thursday and Friday respectively.
  • While the vast majority of participants have since commented that they supported the half-point cut, the meeting decision brought the first dissent from a Fed governor (Bowman) since 2005, and it will be interesting to get a gauge of how many non-voting members also opposed the outsized rate reduction.
  • Consensus sees core CPI at 0.2% M/M in September, although there is sizeable skew toward a higher outcome and our survey of unrounded estimates sees an average 0.26% M/M. That’s only slightly softer than the surprisingly solid 0.28% M/M in August, but the drivers should differ.