US Treasury rates are 2-3 bps higher across the curve, reversing some of the fall seen over recent sessions.
The 10-year rate got to as low as 2.31%, close to the bottom of the well-established 2.30-2.60% range, before selling pressure emerged and the yield is currently at 2.35%.
This move has gone against the grain of further falls in European rates, with Germany’s 10-year bund yield down a couple of basis points to 0.25%, the lowest level in over a month.
For the US market, Trump’s talks later in the week with President Xi and Friday’s non-farm payrolls release remain the focus.
Local rates showed a decent fall yesterday, supported by the fall in global rates and showing no reaction to the QSBO. The 2-year swap rate fell by 4 bps to 2.27% and the 10-year rate fell by 7 bps to 3.36%.
We’ll likely see some reversal of those moves today.
Tonight sees the release of the US ISM non-manufacturing survey and ADP employment report. Both are expected to be softer than prior figures.
Tomorrow morning sees the release of the minutes from the FOMC’s March meeting. We can’t see how they can add much, given the plethora of Fed speakers on the circuit in the weeks after the meeting.
Daily swap rates
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Jason Wong is on the BNZ Research team. All its research is available here.
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