U.S. Treasuries are on track for a modestly higher start in the belly of the curve while the 2-yr note is expected to begin closer to its flat line. Treasury futures slipped out of the gate last evening but reclaimed their early losses shortly after the start of the Asian session. The market rallied to highs over the next hour but staying near the best levels of the night has been a challenge. Treasury futures marked fresh highs as attention turned to Europe, followed by another slide that erased a large portion of last night’s gains.
Global equity markets started the week on a generally quiet note even though China reported weak economic figures for April, reflecting the impact of coronavirus restrictions. The EU Commission’s spring forecast lowered the 2022 growth outlook for the eurozone to 2.7% from 4.0% and raised the inflation forecast to 6.1% from 3.5%. Similarly, Goldman Sachs lowered its forecast for 2022 growth in the U.S. to 2.4% from 2.6% while the outlook for 2023 was reduced to 1.6% from 2.2%.
The U.S. Dollar Index is down 0.1% at 104.43.