Bonds are actively trying to decide who they are and what they want to do with their lives.  Will they be barometers of economic growth and inflation?  Or will they be gauges of Fed bond buying and US government bond selling (supply and demand)?

The answer is "yes" on both accounts, but as is often the case--especially when yields have been holding at lofty levels--there's a bit of uncertainty as to how much of the future is already priced-in.  Put another way, in a rising rate environment where the reasons for the weakness are well known and well anticipated, bonds increasingly ask "are we there yet?"

Today brings a fresh update on one of those "reasons for weakness" in the form of October's CPI data.  Inflation has also been holding near post-crisis highs, and traders are waiting to see if recently stronger wage growth will push it up and over the 2.2-2.4% range that's served as the ceiling for nearly a decade. 

The first bounce on that ceiling was completely irrelevant because the year-over-year reading was based on the super low inflation seen during the recession.  2016 and early 2017 presented more legitimate threats, but inflation mysteriously dropped off as 2017 progressed (some say due to changes in cell phone plans!).  Now that we've returned with the support of the fastest post-crisis wage growth to back us up, inflation back in focus.  

All that to say something that's fairly logical: a big beat/miss in today's inflation numbers could have a big impact on bonds.  But in their currently indecisive state, anything outside a BIG beat/miss could leave us to continue following the recent volatility in equities markets.  Either way, we'll know shortly.