Daily Market Color

What Inversion?

10-year Treasury yield crests 2.75% as curve steepens ahead of CPI. The long end led the curve higher today, the 10-year Treasury yield climbing 8bps to close above 2.75% at 2.78%. The move continues the steepening trend seen last week, and brings the spread between 2-year and 10-year rates to 27bps after it briefly dropped below 0% earlier this month. The short-end of the curve was little changed and continues to price in nearly 9 rate additional rate hikes through the end of the year. 

Will inflation hit another 40 year high tomorrow? Yes- at least that’s what the median economist surveyed by Bloomberg thinks. Consensus estimates call for headline CPI to hit 8.4% on a YoY basis, and for headline prices to increase by 1.2% since last month’s reading. Core CPI is expected to increase as well, but at a significantly lower rate. 

Day ahead. It’ll be a busy day for the market, even after March’s CPI figure is released at 8:30 ET. Fed officials Brainard and Barkin will both speak, and the Treasury will auction off $34B of 10-year notes.

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