Treasury yields ended the week higher, although the 10-year yield managed to close below 2.50%. The yield curve maintained its conspicuous “bowed” shape, with yields on the 3- and 5-year notes below that of the 2-year, leaving the 2-5yr spread slight inverted (-3.5 basis points) while the 2-5-10 butterfly decreased by another 2.5 bps to end at -22.5 bps.
Treasury yields declined on the week, leaving the 10-year yield at its lowest level since December 2017. The belly of the curve underperformed, as the 2-year note and 30-year bond both had the best weekly performance.
Last week’s Federal Reserve Open Market Committee (OMC) meeting caused a huge shift in bond market sentiment, pushing Treasury note and bond yields sharply lower while leaving money market rates (i.e., maturities less than one year) virtually unchanged.
Treasuries closed the week with a small rally that left the 10-year yield below 2.60% for the first time since early January. The yield curve flattened modestly, with the 2-10 year spread about 1.5 basis points tighter at +15 while the 2-5 year spread also flattened (inverted) by another basis point to -4.3 bps.
Treasury yields dropped on the week, reflecting signs of economic weakness on the horizon and a weak February employment report. View MBS Weekly Market Profile Report *The MBS Weekly Market Profile Report corresponds to the commentary below.* Treasury yields dropped...
Treasury rallied again last week, pushing the yield on the 10-year note to 3.076% on Friday, its lowest level since October 2nd. The rally was spurred by another bout of volatility in the equity markets, as well as nervousness caused by a rash of mailbombs sent to U.S. political figures. The rally in intermediate and long-term Treasuries served to flatten most of the yield curve; the 2-10 spread contracted by about 2 basis points to +27, although the 10-30 spread widened by 5 basis points to +23.5.
September 21, 2018 Stocks are hovering near all time highs in the AM as investors patiently await the rebalancing of major sectors. The Global Industry Classification Standard will shuffle some internet and media stocks into a new distinction called “communication...