Wednesday proved to be frustrating for bond market watchers and fans of low rates.  Yields rose to the highest levels in several weeks without any satisfying provocation.  We knew we'd have more actionable data in the final 2 days of the week and the first installment is proving to be bond friendly. At the time of last month's initial release Q1's PCE price index came in at 3.7 vs 3.4, which was bad for rates.  Today's revision to the Q1 data dropped that number to 3.6--a minor victory to be sure, but one that affords some more hope that inflation is moving back where we want it after an elevated Q1.

Bonds responded positively, but not excessively.  Still, when combined with overnight gains in place before the data, it's been enough to erase yesterday's modest weakness.  Note the bigger movement on Tuesday in lower volume and with less justification.  This is the type of random momentum occasionally seen near 3-day weekends and amid a general dearth of relevant drivers.