U.S. 20-year Treasury Bond Auction with High Yield of 3.29% on Higher International Demand

Treasuries have moved to their best levels of the day after the US Treasury 20-Year Bond Sale garnering a B- rating across the fixed Interest desk with strong demand from the international market. The tail was -1.4 basis points with WI level at time of the auction 2.665% and the high yield of 2.651% at the auction. The long bond maintaining its leadership with equity markets selling off. Today’s $17 bln 20-yr bond -0.2 basis point indicative of strong demand. … Continue reading “U.S. 20-year Treasury Bond Auction with High Yield of 3.29% on Higher International Demand”

US Mortgage Applications Slide 11% After Federal Reserve Raised Rates 50bps

The Mortgage Bankers Association showed mortgage applications in the US fell -11.0% after rising +2.0% last week. The Federal Reserve raised rates 50bps that week. The 30-year mortgage rate has been rising with yields with higher house prices in general. The purchase index slumped to its weakest level since May 2020 and the refinancing index to its lowest since January 2019.  Mortgage Bankers Association for the week ending 13 May 2022 US MBA mortgage applications w.e. 13 May -11.0% vs … Continue reading “US Mortgage Applications Slide 11% After Federal Reserve Raised Rates 50bps”

Dutch Central Bank Chief First ECB Governor To Raise Prospect of 50Bps Rate Rise

A top European Central Bank official has raised the prospect of a half percentage point rate increase in July. Dutch central bank chief Klaas Knot said if inflation continues to climb then rates may need to be raised. This was the first time such an aggressive shift has been suggested. The ECB left rates unchanged as expected in April. The bank left deposit facility interest rates at -.50%. Highlights Dutch central bank chief Klaas Knot is one of the more … Continue reading “Dutch Central Bank Chief First ECB Governor To Raise Prospect of 50Bps Rate Rise”

Banco de México Raises Rates Again with Inflation Risk to Mexican Economy

The Mexican Central Bank, Banco de México raised interest rates by 50 basis points to 7.00% with the bank saying headline and core inflation forecasts were revised upwards. One dissenter voted to hike by 75 bps. The Mexico central bank Governing Board increased the target for the overnight interbank interest rate by 50 basis points to 7.00%. The vote was not unanimous. Voting in favor of the decision were Victoria Rodríguez, Galia Borja, Gerardo Esquivel, and Jonathan Heath. Voting in … Continue reading “Banco de México Raises Rates Again with Inflation Risk to Mexican Economy”

Solid 30-year Treasury Bond Auction with High Yield of 2.997% Follows CPI and PPI

The US Treasury 30-Year Bond Sale of $22 billion performed stronger than the recent 3 and 10-year auction after today’s PPI report. The tail was 0.9 basis points with WI level at time of the auction 3.006% and the high yield of 2.997% at the auction. The Fixed Interest desk rated it an A after yesterday’s C- on the 10-year auction. The bid-to-cover ratio of 2.30x was below average 2.31x, as was indirect takedown 65.2% vs 65.8% average. The desk … Continue reading “Solid 30-year Treasury Bond Auction with High Yield of 2.997% Follows CPI and PPI”

Weak U.S. 10-year Treasury Bond Auction Graded C Minus with High Yield of 2.943% and 1.4 Basis Point Tail 

The US Treasury 10-Year Bond Sale performed worse than expected following the hot April CPI number released earlier in the day, garnering a D+ rating across the Fixed Interest desk with strong demand from the international market. However, the tail was -1.4 basis points with WI level at time of the auction 2.929% and the high yield of 2.943% at the auction. Soft demand after yesterday’s $50 billion 3-yr note sale. The post-auction selling was heaviest in the long bond as … Continue reading “Weak U.S. 10-year Treasury Bond Auction Graded C Minus with High Yield of 2.943% and 1.4 Basis Point Tail “

Strong U.S. 3-year Treasury Bond Auction with High Yield of 2.802%

The US Treasury 3-Year Bond Sale performed much better than expected, garnering an A- rating across the Fixed Interest desk with strong demand from the international market. The tail was -.3 basis points with WI level at time of the auction 2.812% and the high yield of 1.809% at the auction. Solid demand ahead of the results of this month’s auctions of $36 billion worth of ten-year notes and $22 billion worth of thirty-year bonds on Wednesday and Thursday, respectively. … Continue reading “Strong U.S. 3-year Treasury Bond Auction with High Yield of 2.802%”

Bank of England Raises Interest Rates Fourth Time to 1.00% and Forecast 10% Inflation and Recession Early in 2023

The Bank of England MPC at its May meeting raised the bank rate by 25 bps from 0.75% to 1.00%, as expected. The vote was 6-3 vs 8-1 expected (Haskel, Mann, Saunders voted to raise bank rate 50 bps to 1.25%). The BoE said some further modest tightening may be appropriate in the coming months. The move followed a day after the Federal Reserve raised rates by a half of a percent at their May meeting. Inflation is at the … Continue reading “Bank of England Raises Interest Rates Fourth Time to 1.00% and Forecast 10% Inflation and Recession Early in 2023”

Federal Reserve Raises Rates 50 Basis Points First Time Since 2000 as Expected

The Federal Reserve raised rates by a half of a percent at their May meeting. This was the first time the bank raised rates this much since May 2000 when the Fed was led by Alan Greenspan. The Central Bank raised interest rates by 0.50% (to a target of 6.5%) back then. That was the last time the Fed would ever raise interest rates by that much in one move until day. The rate hike was priced in. The Balance … Continue reading “Federal Reserve Raises Rates 50 Basis Points First Time Since 2000 as Expected”

US Mortgage Applications Rise First Time in Two Months Ahead of Federal Reserve Expected to Raise Rates 50bps

The Mortgage Bankers Association showed mortgage applications in the US rose for the first time in 8 weeks. The 30-year mortgage rate has been moderating as yields stall somewhat ahead of the FOMC with higher house prices in general. The Federal Reserve is expected to rewind to May 2000 today, when “inflationary imbalances,” saw the Fed led by Alan Greenspan raise interest e rates by 0.50% to a target of 6.5%. That was the last time the Fed would ever … Continue reading “US Mortgage Applications Rise First Time in Two Months Ahead of Federal Reserve Expected to Raise Rates 50bps”