Daily Market Color

Bonds Rally Ahead of Inflation Data

Yields rise ahead of Friday’s PPI release. Treasury yields rose across the curve today, the 2-year yield rising ~5bps to 4.31% and the 10-year yield increasing ~7bps to 3.48%. The move comes as investors await tomorrow morning’s PPI data, where forecasts call for a 0.2% MoM increase in producer prices. The release will be under the spotlight with the FOMC meeting coming next week. Meanwhile, equities climbed during the session, the S&P 500 rising ~0.75% and NASDAQ realizing gains of 1.13%.

Jobless claims data shows few signs of slowing job market. Initial Jobless Claims data was in-line with expectations, rising to 230,000 from 226,000 in October. Despite the slight increase, today’s print does not signal a material softening of the labor market, which has remained strong despite Fed hikes. The steady increase in continuing claims, however, may indicate that it has become tougher for unemployed people to find new jobs, which may be an early signal. As the Fed mulls the pace and intensity of further hikes, labor market developments will continue to watched.

Day ahead. PPI will be released at 8:30 AM ET. Michigan consumer sentiment for December will follow at 10 AM, which will be the last major event of the session.

Ready to start a conversation?

We offer free consultations and platform demos.

Let's Talk