Reply To: Bond Traders Weekly Outlook: Key 2s10s Treasury Spread Compressed 50% In Second Quarter


U.S. Treasuries lows after sharp upward revision to Q1 GDP & unexpected drop in jobless claims

The post-data retreat has lifted yields on the 5-yr note and shorter tenors to fresh highs for the month while the 10-yr yield is now within a basis point of its high from June 14 (3.851%).

The data led to an uptick in rate hike expectations, though even with today’s 140 bps increase, the implied likelihood of a second rate hike at the September meeting remains below 50.0%, currently hovering at 26.8%. Equities started the day near their flat lines, but they are rising off those levels with the S&P 500 currently up 0.1%.

2yr +15 bps to 4.87%
3yr +14 bps to 4.48%
5yr +16 bps to 4.13%
10yr +13 bps to 3.84%
30yr +10 bps to 3.90%