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Treasury Yields and Swap Rates Rocket Higher

10-year Treasury yield breaches 1.6% for the first time in a year
After opening at 1.38% this morning, the 10-year Treasury yield rose dramatically, crossing the 1.5% threshold and hitting an intraday high of 1.6% for the first time since January of 2020. The 5-year rate also shot higher and rose 21 basis points to 0.82%- one of the biggest intraday jumps in the last decade. The violent sell-off in Treasurys comes despite Fed Chair Powell’s dovish comments before Congress earlier in the week where he stated that he was unconcerned about inflation. The 10-year Treasury yield, which fell an astonishing 1.50% in 2020, has climbed higher by 0.50% in the last week alone.
730,000 jobless claims were filed last week
The figure fell sharply from the 841,000 recorded the week prior, the largest drop in weekly claims since last summer.  The four-week moving average fell to 807,750.
Q4 2020 GDP is revised upward from 4% to 4.1%
The second quarterly estimate of Q4 2020 GDP shifted higher due to a combination of greater state and local government spending in addition to a 25.7% annualized rise in business and home investment.
Orders for durable goods increased by 3.4% in January vs. 1.2% last month
The rise in January orders, driven mainly by rising equipment demand, was the largest jump in six months and has pushed total factory production to near pre-pandemic levels.
USDCAD price falls below 1.2510, its lowest level in three years
A significant drop from ~1.4600 level just a year ago, USD is now sitting on a significant support range – an important level to watch for banks and companies with Canadian dollar exposure.  A break lower could test levels not seen for 5 years.

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