Month/Quarter-End Came Early

As we witness the absolute lack of any meaningful volatility at the 3pm CME close today, we can safely say that month-end trades were pulled forward to this morning, and also to yesterday.  That means Thursday's reaction to GDP/Claims may have been a bit overdone.  In the absence of month-end, it would likely have been a large, in-range correction but not one that tested the range so aggressively.  As for today, a friendly response to as-expected PCE inflation left bonds modestly stronger with little fanfare after the morning hours.

Econ Data / Events
    • Core PCE Price Index
      • 0.3 vs 0.3 f'cast, 0.4 prev
    • Core PCE (y/y)
      • 4.6 vs 4.7 f'cast, 4.7 prev
    • Consumer Sentiment
      • 64.4 vs 63.9 f'cast, 59.2 prev
Market Movement Recap
08:59 AM

Flat in Asia. Slightly weaker in Europe.  Rallying in domestic trading.  10yr down 1.5bps at 3.827.  MBS up an eighth.

01:25 PM

Modest gains continue.  MBS up 6 ticks (.19).  10yr down 3bps at 3.811.

04:02 PM

Another flat afternoon.  MBS up an eighth.  10yr down 2.3bps at 3.819.