Bonds came into the domestic session at slightly weaker levels after losing ground gradually in the overnight session. They morning's economic data was basically a wash. Durable goods came in hot, but the report has been volatile surrounding fiscal policy implementation. Quarterly PCE was revised up, but that's stale data (Q4, 2024). On the rate-friendly side, Jobless Claims were much higher than forecast, but still not out of line with trend levels from the past few years. Tomorrow's monthly PCE data should be less prone to "yeah buts." That said, keep in mind that some of the positive reaction potential has already been traded after the PPI data 2 weeks ago. In other words, core PCE might need to be lower than expected to see a rate-friendly reaction (as opposed to merely hitting the 0.3% month-over-month forecast).
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- GDP
- 2.3 vs 2.3 f'cast
- PCE Price Index revised up 0.2
- Jobless Claims
- 242k vs 221k f'cast, 220k prev
- Durable Goods
- 3.1 vs 2.0 f'cast, -1.8 prev
- Core Durable Goods
- 0.8 vs 0.2 f'cast, 0.2 prev
- GDP
Slightly weaker before data, and mostly choppy/sideways after that. MBS down roughly an eighth of a point and 10yr up 2.9bps at 4.288
Broadly sideways after a modest recovery. MBS down 1 tick (.03) and 10yr up 2.5bps at 4.285
MBS down 2 ticks (.06) and 10yr up 1.4bps at 4.272
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