Tonight's theme: "not many."
It's not many times that GDP will crack 4% after being down more than 2% in the previous quarter, but it did today.
But that's because it's not many times that the US economy will grow at 3.5% in one quarter and then drop to -2.9% in the following quarter, all the while with job creation averaging over 200k, but it did that from Q4 2013 to Q1 2014 (i.e. something was wrong with that picture, and as we've discussed, it set today's result up to be much bigger).
Finally, it's not many times that an FOMC Announcement will be second fiddle as a market mover, but it was today, because of all of the above.
Less cryptically now... Bond markets tanked right after GDP and never looked back. The damage was fairly severe in the context of 2014 movement, but the saving grace is that we were very near the best levels of the year and that the weakness leveled off into the afternoon.
To borrow from tonight's Ratewatch analysis,
"The long term risk is that today's GDP marks a broad turning point for US rates markets (Treasuries, MBS, etc.). There's an uncertain amount of balance brought to that risk from the ongoing slide in European rates markets. For instance, German government debt just hit an all-time low yield yesterday. If the trends that brought it there continue, it will be hard for US rates to move up too quickly. While there's no way to know how that will shake out, the short term risk lies primarily with Friday's jobs report. If it's much stronger than expected, it will be a strong vote in favor of this week's potential role as a turning point."
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