Straightforward sell-off

Straightforward sell-off

Bonds managed to begin the day sideways to slightly stronger, although the strength was more apparent in the longer end of the yield curve.  Perhaps market participants could sense the impending curve flattening bias in today's big ticket econ data.  ISM Services beat the consensus and the inflation component rose for the second straight month, reaching the highest levels since March.  The implications for core services inflation go without saying and the market traded it as such with a obvious bump to implied Fed Funds rates for 2024 contracts.  The longer end of the curve fared better but still lost a bit of ground.  Corporate bond issuance remains a background problem.  Technicals may see some increased focus for the rest of the week without much by way of meaningful data until next week's CPI.