Yields hold steady as US-Iran uncertainty continues. Treasury yields ended the day little changed as the state of US-Iran negotiations remain unclear, with President Trump saying that the US has been “continuously” discussing with Iran despite recent Iranian reports that negotiations were halted. The 2-year yield closed 1bp higher at 4.04%, while the 10-year yield closed 1bp lower at 4.44%. Meanwhile, the S&P 500 and NASDAQ closed 0.13% and 0.03% higher, respectively, with technology stocks leading the gains. Oil extended the prior session’s climb, with WTI crude up ~1.3% trading around $94 per barrel.
Job openings surge in April. Today’s JOLTS data showed US job openings rose to 7.62 million in April, well above the forecasted 6.87 million and March’s upwardly revised 6.89 million. Marking the highest level in nearly two years, the increase in openings was largely driven by the professional and business services sectors, which hit a three-year high. Meanwhile, layoffs fell to 1.69 million, down from a revised 1.88 million in the prior period and below expectations of 1.84 million firings. Today’s print comes ahead of Friday’s nonfarm payrolls report, which is expected to show 85k jobs added in May, down from 115k in April.
Hammack warns Fed may need to raise rates soon. Cleveland Fed President Beth Hammack said in a speech today that the central bank may need to act soon to combat inflation pressures, though she believes it is reasonable to hold rates steady for now given the uncertain outlook. Hammack remains more concerned about the risks of persistently elevated inflation than employment, and expressed that policy may not be restrictive enough to bring inflation back to the Fed’s 2% target. Hammack cautioned that “if recent trends continue, it may soon be appropriate to act,” adding that waiting for definitive evidence that inflation has become embedded could require larger and costlier policy adjustments later.