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Bond Market Update

  • The Market at 15:23 ET

    10-Year: +6/32…2.40…EUR/USD: 1.0806USD/JPY: 110.80

    Treasury Market Stands Its Ground

    • St. Louis Fed President Bullard (non-FOMC voter): Inflation has essentially returned to 2% and is expected to remain there; the Fed can take a wait-and-see approach on fiscal policy changes; relatively low policy rate likely to remain appropriate; would be ok for the Fed to hike once more in 2017; you'd see weaker equities if the Fed gets too aggressive
    • February Durable Goods Orders: Actual 1.7%, consensus 1.3%, Prior 1.8%
    • Durable Goods Orders ex-trans: Actual 0.4%, consensus 0.7%, Prior -0.2%
    • Treasury Secretary Mnuchin: Extraordinary measures will get us past the summer with respect to the debt ceiling
    • San Francisco Fed President Williams (non-FOMC voter): Sees three or four rate hikes in 2017; big balance sheet is pushing down term premium; important that Fed keeps inflation expectations anchored at 2%; Fed is not trying to overshoot on inflation target to compensate for undershooting; possible that inflation pressures will build as employment grows so Fed should stay close to target
    • New York Fed President Dudley (FOMC voter): We're pretty close to both Fed objectives; may have inflation problem if UE gets much lower; U.S. economy in a "pretty good place right now"
    • GOP leaders not confident they have votes to pass bill -- Bloomberg