Yesterday's economic data made for a bit of back and forth in the bond market with Fed speakers ultimately riding to the rescue by forwarding the notion of "skipping" a rate hike at the upcoming meeting. Today was a bit different with the AM econ data largely coming across in a bond-friendly manner. This was especially true of Q1 unit labor costs which missed estimates by a wide margin. Traders have increasingly moved on from debt ceiling headlines and are now turning their attention to Friday's jobs report as casting the tie-breaking vote on whether this week's events merit a return to the previous 3.4-3.6 range in 10yr yields.
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- Challenger Job Cuts
- 80.1k vs 92k f'cast
- ADP Employment
- 278k vs 200k f'cast, 296k prev
- Jobless Claims
- 232k vs 235k f'cast, 229k prev
- Q1 Labor Costs
- 4.2 vs 6.3 f'cast, 3.3 prev
- ISM Manufacturing
- 46.9 vs 49.8 f'cast, 50.2 prev
- ISM Prices Paid
- 44.2 vs 52.0 f'cast, 53.2 prev
- Challenger Job Cuts
slightly weaker after am data. 10yr down half a bp at 3.65. MBS down just over an eighth, but illiquid.
Nice bounce back after 8:30am data. MBS up nearly a quarter point and 10yr down 4.4bps at 3.601
MBS at best levels with 5.0 coupons up 3/8ths. 10yr down 4bps at 3.605
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