Daily Market Color

Rates Rise on Strong Quarterly Data

Rates rise on strong economic data. Rates were up across the curve today following quarterly PCE and GDP data, which were roughly in-line with prior levels. Rates rose most in the front-end of the curve, with the 2-year yield climbing by ~6bps to 4.27% while the 10-year rose ~2bps to 3.68%. Tomorrow’s shortened trading day will be highlighted by Personal Income and Spending data along with PCE. Equities were also down on the news, the S&P 500 declining ~1.50% to 3,822 and the NASDAQ declining ~2.00% to 10,476.

PCE Preview. Following last month’s slight inflation decline, markets will be focused on tomorrow’s print for signs of a continued deceleration in inflation rates. MoM PCE for November is expected to be 0.1% vs. 0.3% in October, and core PCE is expected to be 0.2%, in-line with last month. YoY, PCE is expected to be 5.5%, vs 6.0% last month. 

Day Ahead. Tomorrow’s November PCE data will be released at 8:30 AM EST, also watch for Durable Goods Orders at 8:30 AM EST, and New Home Sales at 10:00 AM EST.

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