Bonds Opt to Avoid Exuberance Ahead of Powell

After Wednesday’s big rally ended with bonds near their best levels of the day, there was some small chance that the bond market would take a more exuberance approach to Thursday with a bit of a follow-through rally.  That said, there was a better chance that Wednesday’s rally was a limited-time engagement to blow off the oversold steam.  It would have made slightly better sense for bonds to hunker down today ahead of Powell’s Jackson Hole appearance on Friday, and that’s exactly what happened.  

Econ Data / Events

Jobless Claims

230k vs 240k f’cast, 239k prev

Durable Goods

-5.2 vs -4.0 f’cast, 4.7 prev

Durable Goods, Excluding Transportation

0.5 vs 0.2 f’cast

Market Movement Recap

08:37 AM 10yr up 3bps at 4.227 and MBS down 3 ticks (.09), with slight additional weakness after the data.

12:13 PM Losing a bit of ground.  10yr up 3.1bps at 4.227 and MBS down 7 ticks (.22) in 6.0 coupons. 

02:37 PM Modest weakness continues.  10s up 3.5bps at 4.231.  MBS down 6 ticks (.19).