Europe Helps US Bonds Avoid a Bigger Data-Driven Sell-Off

In a vacuum of "data dependency," today should have been worse for bonds.  All three of the morning's economic reports pointed toward higher rates.  After selling off for a few moments, trading levels returned to stronger territory on the day and stayed there for more than an hour.  It wasn't until the afternoon hours that the modest weakness set in.  Incidentally, the afternoon is when Europe is closed for the day and US bonds fend for themselves.  Up until then, European bonds were helping suppress some of the logical weakness in US bonds due to a favorable interpretation of the ECB's comments delivered with today's ECB rate hike.