USTs – Rebound Has Further Room to Run

U.S. Treasuries pared gains into the close (10y 3.13, -1.5 bps) on Wednesday, following the whipsaw in equities. October CPI at 2.5% offered no excitement, but did not keep 10-year TIPS breakevens from narrowing -1.8 bps. The 2y10y TIPS...

USTs – Flattening-Friendly Outlook

U.S. Treasuries gained ground on Tuesday led by the belly (5y 2.98, -5.6 bps). WTI crude oil has fallen nearly 19% over the past 15 trading days, the most since January 2016. TIPS breakevens narrowed, while awaiting the CPI...

USTs – Bullish Short-term Outlook

U.S. Treasury futures continued the rally on Monday seen by cash markets to close last week. Tech shares are weighing very heavily on major indices, helping push the VIX back toward 20. BofA’s Global Flow Index shows investors’ preference...

TIPS Breakevens – All Eyes on the Fed

 AQA Comments:   Breakeven spreads widened as TIPS outperformed weakening USTs across the curve. Spreads finished roughly 1 bp wider as a result. Monday’s subdued tone carried over into Tuesday’s session as markets wait to digest the results of midterms...

USTs – Flattening Bias

U.S. Treasury (10y 3.212, +1.1 bps) yields retraced Monday’s gains in a subdued Tuesday session. Yields rose 1-3 bps with the belly of the curve underperforming and long end outperforming (30y 4.425 -0.2 bps). Most participants were awaiting midterm...

USTs – Focus on the Fed

U.S. Treasury (10y 3.199, -1.1 bps) yields recovered a bit on Monday. Subdued markets ahead of midterm elections and the Wednesday/Thursday Fed meeting helped. Risk markets were mixed with equities and high yield stronger but energy markets weakening. U.S....

TIPS Breakevens – Wage Gains in Focus

 AQA Comments:   Breakeven spreads found their footing Friday, even as Treasury yields soared and energy markets continued to weaken. The strong payroll report leaves the Fed firmly on track for December and the on-the-screws wage inflation data will leave...