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Best Levels in Weeks Ahead of High Stakes Jobs Report
Best Levels in Weeks Ahead of High Stakes Jobs Report
Rather than circle the wagons and consolidate the recent rally, bonds kicked the buying into higher gear on Tuesday thanks to a surprisingly weak Retail Sales report for December. This can be added to the list of recent data that has urged the bond market to get in position for a similarly weak jobs report tomorrow. Nearly 15bps of improvement in less than a week means that jobs would have to especially downbeat for this pace to continue. If the report surprises to the upside, bonds are at risk of a reasonably brisk correction, but as always, the scope of potential volatility depends on the deviation from the median forecast.
Gradually stronger overnight with additional gains after 8:30am data. 10yr down 5bps at 4.157 and MBS up 2 ticks (.06).
Additional gains. MBS up an eighth of a point and 10yr down 7.3bps at 4.135
off the best levels, but still stronger. MBS up 3 ticks (.09) and 10yre down 5.9bps at 4.149
Drifting sideways into the close with MBS up 2 ticks (.06) and 10yr yields down 6.1bps at 4.147
Best Levels in Weeks Ahead of High Stakes Jobs Report
| Time | Event | Period | Actual | Forecast | Prior |
|---|---|---|---|---|---|
| Tuesday, Feb 10 | |||||
| 8:15AM | ADP Employment Change Weekly | 6.5K | 7.75K | ||
| 8:30AM | Dec Retail Sales (%) | Dec | 0% | 0.4% | 0.6% |
| 8:30AM | Dec Retail Sales Control Group MoM | Dec | -0.1% | 0.4% | 0.4% |
| 8:30AM | Dec Import prices mm (%) | Dec | 0.1% | 0.1% | |
| 8:30AM | Q4 Employment costs (%) | Q4 | 0.7% | 0.8% | 0.8% |
| 10:00AM | Nov Business Inventories (% ) | Nov | 0.1% | 0.2% | 0.3% |
| 12:00PM | Fed Hammack Speech | ||||
| 1:00PM | 3-Yr Note Auction (bl) | 58 | |||
| 1:00PM | Fed Logan Speech | ||||
| Wednesday, Feb 11 | |||||
| 12:00AM | Roll Date - UMBS 30YR | ||||
| 7:00AM | Feb/06 MBA Refi Index | Feb/06 | 1269.7 | ||
| 7:00AM | Feb/06 MBA Purchase Index | Feb/06 | 165.4 | ||
| 7:00AM | Feb/06 Mortgage Market Index | Feb/06 | 330.8 | ||
| 8:30AM | Jan Unemployment rate mm (%) | Jan | 4.4% | 4.4% | |
| 8:30AM | Jan Non Farm Payrolls (k) | Jan | 70K | 50K | |
| 10:15AM | Fed Bowman Speech | ||||
| 10:30AM | Feb/06 Crude Oil Inventory (ml) | Feb/06 | -3.455M | ||
| 1:00PM | 10-yr Note Auction (bl) | 42 | |||
| 2:00PM | Jan Federal budget (bl) | Jan | $-86.5B | $-145B | |
| 7:00PM | Fed Logan Speech | ||||
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